When an economy moves to a point below full employment,economists say that an inflationary spiral has set in.

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When an economy moves to a point below full employment, it typically experiences low inflation or even deflation, since there are fewer people with disposable income to drive up demand and prices. Inflationary spirals occur when an economy is operating above full employment and there is excess demand, leading to rising prices and wages, which in turn drive up production costs and fuel further inflation.

When an Economy Moves to a Point Below Full Employment,economists