Inflation is an economic condition in which the aggregate prices are always increasing in a country.
Introduction of Inflation
Inflation is an economic
condition in which the aggregate prices are always increasing in a country. The
value of money is falling. Inflation is nothing but too much of money chasing
too few goods. For example in Zimbabwe the inflationary rate is too high as
more than 1000 % and in turn they require bag full of money for a meal. And the
value of their currency is very low in the market. Inflation means not only
sustainable rise in the price of the
goods and services, but the value of
the currency falls in the market and the supply of money in circulation is more.
Deflation is the opposite of
inflation. It is a state of disequilibrium in which a contraction of purchasing
power tends to cause or is the effect of a decline of the price level.
Tags : Managerial Economics - Inflation
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