Cost-Push Inflation and Stagflation

CFA Level I Economics
#1

Dear all,

Is Cost-Push Inflation the same as Stagflation? The model and descriptions seems to be identical.

Thank you.

Cheers,

Ernest

#2

Cost push inflation occurs when the comapnies increase the prices of the commodities in response to the increased costs such as wages, taxes etc.This is primarily done to maintain their profit margins.

Stagflation is the combination of high emploment and economic stagnation with inflation (either demand pull or cost push inflation).

Hence, we can say that cost push inflation is one of the factors that leads to stagflation.

#3

For the Demand Pull Inflation, the price level increases and the Y (GDP or income) is increasing… With the high unemployment rate, is it possible for Y to increase at the same time? Is there a direct correlation between the unemployment rate and Y (GDP or income)?