Demand-pull inflation
This is the imbalance in the relationship between supply - demand. The main reason is because the total
demand rose too fast while the total supply does not increase or increases do not keep pace.
The increase in the money supply is the main reason leading to the increased demand for goods
and services. But this is not the only cause of increased demand. Inflationary pressure
will increase next play from 1 to 3 years, if the demand exceeds the supply of goods, but the production
has not been extended or using machines due to capacity limitations or because of human
factors of production do not meet application of demand is picking up. The imbalance will be the price to fill
fully from which inflation as demand increases (inflation due to poor demand appears. For example
in the US, capacity utilization of machinery is a useful indicator to reflect inflation future
hybrids in the US, capacity utilization over 83% of machinery leads to inflation.
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