Inflation is common term widely used on economic basis. Yet some people do not really go through this term. That’s why it is necessary to answer the question of “What Is Inflation”. To get through, we should acknowledge what it means. It is actually an increase of prices of services and goods which represent the whole economy. Parkin and Bade through Economics has defined what is Inflation, the rising movement of prices and performs as an opposite of deflation. What is deflation? It will be discussed later on the following paragraph.
Perhaps to get well-acknowledged to this case, we had better to learn to opposite of inflation, here is deflation; it is actually a descending movement of prices. The border line between the deflation and inflation is the stability of price. So, What Is Inflation when it comes to relate with money? The rise of prices will actually relate to money as caught by the refrain. In reality, you will not find inflation happened to one kind of good or service, it applies on any type of goods.
What Is Inflation’s cause? It could happen after changing the value of money within the system.
There are 4 factors causing inflation:
- The stock of money is soaring
- The stock of goods descending
- The need of money levels down and the last
- The need of goods rises up.
Here are few factors causing the inflation. We should deal with it and solve the economic issue in order to keep stability of economy.
After understanding What Is Inflation, you now already come on the stage where you have good information about economic issues. When it happens, what could publics do? Government usually discusses the current economic issue and find out the solution to overcome this way and publics can do little things to support government’s program to fight of inflation.