• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Article analysis. The article I chose is about the recent rise in inflation in Hong Kong which mainly accelerated the food prices and the private housing rents.

Extracts from this document...

Introduction

The article I chose is about the recent rise in inflation in Hong Kong which mainly accelerated the food prices and the private housing rents. The article highlights the assumptions that economists and the government of Hong Kong has made of the level of inflation in the next few months. The article focuses on the percent rise in the consumer price index in the past few months. Inflation is defined as a general rise in the prices of goods and services in an economy. The government has predicted the inflation to elevate in the short term, which is defined as, relating to or maturing within a short period of time, usually twelve months. The consumer price index is the official measure of inflation in a country. ...read more.

Middle

This increase in aggregate demand will however also increase the output from Y1 to Yf. Looking at the situation, if the demand in Hong Kong further rises, it will increase the prices with it which will result in a higher inflation rate which might worsen their economy. The writer vaguely identifies the cause of excess demand but does not talk about other causes such as cost pull inflation or inflation due to excess monetary growth that could have helped in driving inflation forward. He also states the problem of rising inflation that Hong Kong is facing, but does not put a possible solution with it. Also, he quotes what the government says is happening in the economy, but does not include the action that the government has decided to take or can take to overcome this problem. ...read more.

Conclusion

He also backs up the situation he talks about, with many figures and numbers that prove the validity of his article. The author does not determine the different stakeholders that could be or are being affected by this rise in inflation. Firstly, he writes about food prices that have risen from which we know that all consumers are being affected, as well as the government that has to provide food for the poor. Secondly, the prices of private housing rents rising as we know will only affect the middle class of the country. Businesses could be affected as they might have to produce more and might raise their prices because of the high aggregate demand. The suppliers have to produce more because of the high demand. In conclusion, the article precisely presents the problems but does not consider the implications of or offer solutions. ?? ?? ?? ?? ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our International Baccalaureate Economics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related International Baccalaureate Economics essays

  1. Commentary on Indian News Article "Food prices push inflation to 6.95%"

    Other experts also point out the latest inflation numbers could prompt the central bank to leave the key policy rate untouched in its mid-quarterly policy review meeting despite the economic growth expected to slow down. "Food inflation will be on the rise and coupled with this would be fuel inflation," according to said Siddharth Shankar, director, KASSA group.

  2. Commentry on Rising Fuel Prices

    But as state government still dilly dally on this issue, their connectivity is suffering. Cities like Lucknow, Varanasi, Trichy, Patna and Rajkot witnessed much lesser domestic flights in April 2008 than last April. While fares of international flights haven't risen as sharply, international passengers have also declined.

  1. Commentary of Phillipine Inflation due to accelerated growth

    Article continues... Clarissa Batino and Michael Munoz. Philippine Inflation Probably Accelerated as Growth Quickened.08/09/2007 http://www.bloomberg.com/apps/news?pid=20601080&sid=aobiGDrtYoRM&refer=asia The Philippine economy is experiencing great levels of economic growth (a), due to healthy levels of spending by the population. Although this desired economic growth will have led to a decrease in the unemployment (b)

  2. Econ commentary. The article talks about inflation in China. The CPI rose 4.9% in ...

    The sustained price growth in food sector. The increase in global commodity prices affects the aggregate supply [u1]curve in the same way as rising energy prices, as both are inputs in production. Rising energy costs and commodity prices leads to a decrease in aggregate supply.

  1. An analysis of Why Economic Sanctions are bad. Quotes and argument.

    The general logic of these sanctions is that cutting a country off from trade will stigmatize the country and starve it for necessary resources. As a result, the rulers of the country will lose legitimacy and eventually their people will overthrow them or the rulers will change their policies.

  2. Rising unemployment and inflation commentary. The above article Bah Humbug talks about the ...

    The downbeat mood was compounded by new labor-market figures, which abruptly ended a surprisingly rosy period. The Office for Budget Responsibility (OBR), which now oversees official forecasts, said in late November that employment had already risen (and unemployment fallen) to levels it had previously thought would not be reached until the middle of 2012.

  1. Macroeconomics IA South Korea inflation at threeyear high on food price jump

    However, this policy has the same negative effect on the economy as the monetary policy, because even though it lowers inflation, it also lowers GDP. This effect can be observed in Figure 3 below. Figure 3: Effect of contractionary Fiscal Policy on Korean economy: Here, we can see that the

  2. Commentary - This article talks about the clear and significant rise in price of ...

    Jackson's Java Coffee House in Charlotte has been roasting and selling coffee for more than 16 years. Seven years ago, the company opened a second location uptown. "There have been dozens of coffee shops in Charlotte that have opened and closed," said owner Mike Jackson.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work