How can Government Control Inflation Rate? (Answered)

Answer to, how government can control inflation, and brief explanation of what causes inflation in a country.

How can Government Control Inflation Rate.
How can Government Control Inflation Rate/ Photo Screenshot taken on 27th May 2019 from IMF page

What is inflation?

In simple terms, inflation is the rice in the price of goods in a country due to decreasing value of its currency.

What Cause Inflation?

The major cause of inflation is the rice in price of goods

Others causes include;

  • Over supply of money
  • High National Debt

How can government control Inflation?

Measures that may be taken by the government to control inflation include:

Setting minimum and maximum wage limits to control salaries. 

  • Restricting imports
  • Controlling of exports
  • Restricting terms of hire purchase and credit terms of sale
  • Price control
  • Offer of subsidies and other incentives to local producers
  •  Controlling the supply and circulation of money in the economy

List of Countries with Highest Inflation Rate in Africa

Below is a list of countries with highest inflation rate in Africa (Last Updated 27th May 2019, Source: tradingeconomics inflation).

List of countries with the highest inflation rate in africa
List of countries with the highest inflation rate in Africa/Photo Source
  1. Zimbabwe 75.8%
  2. South Sudan 56.10%
  3. Sudan 45.40%
  4. Liberia 23.30%
  5. Sierra Leone 17.46%
  6. Angola 17.36%
  7. Egypt 13.00%
  8. Ethiopia 12.90%
  9. Nigeria 11.37%
  10. Guinea 9.70%
  11. Ghana 9.50%
  12. Malawi 9.10%

Want to learn more about inflation Africa? Read this Journal done by Philip Hans Franses from Erasmus School of Economics.

You can also read  9 Uses of National Income Statistics and Methods of Measuring

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