Markets reached equilibrium more slowly and irregularly.
Because it is more difficult to maintain awareness of how one product compares in price to another, inflation raises market uncertainty. In a perfect world, inflation shouldn't distort pricing signals in any way.
An economy faces greater issues if its inflation rate is higher than that of its trading partners. This is due to the fact that its domestic goods and services would be more expensive than imports and its exports would be relatively more expensive. AD and real growth would decline as a result of falling net exports.
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