How will raising interest rates stop inflation?
Inflation is the case in which money supply greatly exceeds value of goods and services at current prices. Thus, the excessive amount of money drives prices higher. When interest rates rise, firms and people will borrow less and have less to spend, and so the money supply drops and prices don`t have to rise. By the way: how did you find my site. On Wed, Jul 1, 2009 at 11:35 AM, petrov.
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- How will raising interest rates stop inflation?
