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Essay text:
A sudden increase in disposable income causes an unequal demand in other sector wherein domestic production cannot meet the demand of consumers. Hence, a greater disposable income combined with the low price of gasoline and huge oil pool surplus has led to an increase of imports. Since, domestic production cannot rise significantly to support this demand, demand for services has increased. As services cannot be imported readily, hence the demand of imported goods has increased to compensate the growth in other sectors. Overall, this increased demand has led to an overall increase in prices thereby resulting in higher inflation...
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