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An article in businessweek warned of the dangers of deflation as the collapse of numerous Asians economies was creating worries that Asia might try to

An article in businessweek warned of the dangers of deflation as the collapse of numerous Asians economies was creating worries that Asia might try to "export its way out of trouble" by over supplying everything from automobiles to semiconductors. Evidence that deflation had become a genuine concern for managers was provided by a statement in the article by John smith, chairman and CEO of General Motors Corporation: "Fundamentally, something has changed in the economy. In today's age, you cannot get price increase." The article offers the following advice to managers: "Productivity growth lets companies boost profits even as prices fall." Using short-run production and cost theory, comment on this advise.

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