cost pull economics

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…showed last 75 words of 1253 total…producers increase their output of autos, they will demand more steel used in producing those cars. The price of steel and other inputs used in the production of autos will also rise. This reaction is similar to the wage price spiral that cost-push inflation creates. As shown in these examples, demand push and cost-pull are very close in how they affect an economy. Both theories are employed in our everyday life and affect us greatly.