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Econ 302 Country - inflation and supports the quantity...

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Adam Bottorff Country ECON 302 4/3/11 St. Lucia 1. 2. Inflation % went up to a maximum of 34% around 1973 and dropped as low as 0% in 2002. Money growth reached a maximum of 26 in 1985 and also had a drop in 2002 at around 3%. Both the Inflation and money growth coincided with each other throughout the years. 3. Yes, this data does support the quantity theory of money, because more money equals more inflation and that an increase in money supply does not necessarily mean an increase in economic output. This graph clearly shows that more money equals more
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Unformatted text preview: inflation and supports the quantity theory of money. 4. In 1973, Inflation was the highest for St. Lucia and there were many reasons why this occurred during this year. The reason for this is because government took a change and a new leader came into office. Also a weather storm and Hurricane hit hard in St. Lucia and killed business. Sugar Cane, which is a big product was hurt along with other agriculture production. http://www.stats.gov.lc/na_main/CPI_Nov_05.htm...
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