Inflation
Inflation Definition: Inflation is a continuous and sustained increase in the general price level of goods and services in an economy over a period of time. In simple words: 👉 When prices of almost everything increase, and the value of money falls, it is called inflation. Effects of Inflation: Decrease in purchasing power Increase in cost of living Uncertainty in business decisions Fixed-income groups (salaried people) suffer the most 2. Causes of Inflation Inflation can be caused by several factors. Major causes include: A. Demand-Pull Inflation Occurs when aggregate demand is greater than aggregate supply . Example: High government spending Increased consumer spending Easy credit and loans Increase in exports Result: 👉 Too much money chasing too few goods. B. Cost-Push Inflation Occurs when the cost of production increases , forcing producers to raise prices....