Answer:
Explanation: F or more than twenty years, economic development in the Federal Republic has been subject
to two principal factors: steady growth of the
GNP, in real terms, and equally steady creeping
inflation. During the 'fifties, the West German
economy had been growing mostly under conditions of annual inflation rates of 1 to 2 p.c.,
while the price level rose much more rapidly during the 'sixties. After the fifth post-war boom had
reached its summit in spring 1971, the inflation
rate hit a new high of 4.5 p.c., the steepest increase since the Korean War inflation. Against the
acceleration of price rises, the fight is being
waged in the Federal Republic using conventional
methods - monetary and fiscal restrictions. As
an additional measure to meet inflation only recently floating exchange rates were introduced.
Many economists believe, however, that West Germany now lives under the treat of an even deeper
recession than 1966/67 or, possibly, even under
that of an American-type "stagflation",
