The Nations Economic Stability Has Many Factors Which

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Term Paper Title	The Nations Economic Stability Has Many Factors Which
# of Words	525
# of Pages (250 words per page double spaced)	2.1

     The nation's economic stability has many factors which
amount to inflation.  Inflation may be caused by a number of
problems, but there are some specific examples which have
direct control over which way the prices and spending sway.
Inflation simply means that the American dollar, in this
case, is less valuable on the foreign exchange market and
the gold standard is moved to higher prices; which simply
means that more currency is needed to exchange for gold.

     Any slight change in investments or a company's cost
premium could change the entire economy because of the
domino effect acting on the rest of society.  For an
example, flooding in a particular region of the country
could cause inflation.  In the long run, the flooding may be
catastrophic for businesses because it could cause a
shortage of products.  In order for the businesses to make
up for any lost income, they must boost their prices and
make the profit margins go up.  The profit margins make up
for the lost income and balance out that particular company,
but everyone else must suffer the consequences.  In the
business world; the more they produce, the less they can
sell for; the less they produce, the more they sell the
product for.

     Profit margins can have a direct impact on the
consumer.  The more an item cost, the less a consumer will
want to purchase that particular good.  Higher profit
margins may be able to balance a company's budget, but
unless their product is in very high demand, most people
will want to buy the product.  The lack of people purchasing
the item may cause the company to lose money and have no
alternative other than to lay off workers...

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