CH 10

This chapter mentioned that the American economy can grow around 3 percent per year. Otherwise the inflation rate will go up, which is not good for our economy because the $1 cannot buy as much as it could before. I was wondering about China though. In class you told us that China's economy is growing at a much faster rate than the U.S. economy. How has the Chinese economy not suffered from this. Their inflation would go up and they would fall into an economic recession. It is confusing to me how their economy is able to grow so quickly and not suffer from it. My best guess is that because China was not as far as up as we were they were able to grow more quickly. People may think China will pass the U.S., but eventually China will have to slow down because there is not as much room for them to grow. If there is a better reason than what I just gave I'd like to know. Or if my reason I gave is very wrong I'd also like to know.