Inflation

Rare card · No. 38313

In economics, inflation is an increase in the average price of goods and services in terms of money, though it originally referred to the increase of the money supply (monetary inflation) that can cause such a universal shift. This increase is measured using a price index, typically a consumer price index (CPI). When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation corresponds to a reduction in the purchasing power of money. The opposite of inflation is deflation, a decrease in the general price level of goods and services. The common measure of inflation is the inflation rate, the annualized percentage change in a general price index. Changes in inflation are widely attributed to increases in the money supply, fluctuations in real demand for goods and services (also known as demand shocks, including changes in fiscal or monetary policy), changes in available supplies such as during energy crises (also known as supply shocks), significant...

Read on Wikipedia · Image Justin Liu (JJLiu112), CC0