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Why is inflation so low despite record expansion of the US economy?
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Perhaps because there have been numerous technological innovation as well as changes in technology for communication in recent years which has increased the growth rate of productivity. this can also be seen as a rightward shift of the aggregate supply curve which has reduced the cost of production and has resulted in lower rate of inflation. All of this has happened despite the record expansion in the United States where the current GDP is greater than its potential GDP. Still the rate of inflation has been around 2% or below because of the increased innovation, technological advancement, productivity growth and reduced cost of production.

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