ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Inflation is a decrease in the purchasing power of money, reflected in a general increase in the prices of goods and services in an economy. The Consumer Price Index (CPI) measures change over time in the prices paid by consumers for a representative basket of goods and services.

Detailed explanation-2: -Inflation is the rate of increase in prices over a given period of time. Inflation is typically a broad measure, such as the overall increase in prices or the increase in the cost of living in a country.

Detailed explanation-3: -Demand-pull inflation As a result, demand for goods and services will increase relative to their supply, providing scope for firms to increase prices (and their margins – which is their mark-up on costs). At the same time, firms will seek to employ more workers to meet this extra demand.

Detailed explanation-4: -Inflation refers to a broad rise in the prices of goods and services across the economy over time, eroding purchasing power for both consumers and businesses. In other words, your dollar (or whatever currency you use for purchases) will not go as far today as it did yesterday.

Detailed explanation-5: -Inflation has caused the cost of many goods in the US to increase significantly in the past year. This chart shows the overall price changes of selected goods during this period using data from the U.S. Bureau of Labor Statistics. The most significant change is the cost of school lunches, which rose by over 254%.