In this episode, we break down the concept of deflation, a key topic in A-level economics. You’ll learn what deflation is, how it differs from negative inflation, and explore its causes, including falling demand and increased productivity. We also discuss the economic consequences of deflation, such as its impact on consumer spending, investment, and debt. Using real-world examples such as Japan and simple explanations, this episode will help you understand why deflation is often seen as a challenge for policymakers.

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