M7D1: Do We Know the Inflation Rate? Is it Bad?

 
View the following video on inflation: 

Tracking inflation: How fast are prices rising? (Links to an external site.)Links to an external site. (2011). [Video file, 8:42 minutes]. Retrieved from https://vlib.excelsior.edu/loginurl=http://fod.infobase.com/PortalPlaylists.aspx?wID=103647&xtid=53392

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This discussion will address the following Module Outcomes:

MO1: Determine the potential effects of inflation when evaluating an engineering project or system. (CO6)

The equation of exchange, MV≡PQ, seems to readily explain inflation. Based on the readings and video, please respond to the following:

Why is inflation such a difficult problem in so many economies?

Do some research to find an industry or firm, either now or in the past, that was affected by inflation. In your initial post, write a brief synopsis of the situation and how they reacted to it.

As an engineer, you may find it interesting to compare what countries receive large business and manufacturing investments vs. those that do not. Note that there are also other considerations beyond inflation concerns.

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