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a particualr situation beyond the fullempolyment where only price level increses with no change level outuput is known as

Question

A particular situation beyond the full employment where only price level increases with no change in the level of output is known as

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Solution

The situation you're referring to is known as "Inflation". In economics, inflation is a sustained increase in the general price level of goods and services in an economy over a period of time. When the general price level rises, with each unit of currency buying fewer goods and services, it reflects inflation. The measure of inflation is the inflation rate, the annualized percentage change in a general price index.

Here are the steps to understand this:

  1. Full employment is a situation in which everyone who wants to work can find employment. This is often considered the ideal situation for an economy.

  2. If we are in a situation of full employment and the price level increases, it means that the cost of goods and services is going up.

  3. However, if the output level (the amount of goods and services produced) does not change, it means that the economy is not producing more than before.

  4. Therefore, the increase in price level is not due to an increase in demand or production, but rather due to inflation.

  5. Inflation can be caused by several factors, including an increase in production costs, a decrease in the supply of money, or government policies.

  6. Therefore, a particular situation beyond full employment where only the price level increases with no change in output level is known as inflation.

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