Maddie Binning, Chapter 10, Question #7

The concept presented about the "speed limit" of the economy is one that was completely foreign to me. It seems like more growth would be better. That sounds like a logical conclusion. However, the idea that inflation is a result of that unregulated growth makes it a much more complex issue. This chapter gave me a new way of seeing growth and the calculation of interest. Prior to this reading, I thought the assignment of interest was completely random. I thought that companies would calculate interest like prices, through the consideration of demand for service and competition in the industry. I never realized that the Fed would have such an impact on those rates. These concepts as whole bring light to why the business cycle exists and helped me understand why uninterrupted growth is not truly possible.