I don’t quite get it, I understand its related to change in prices over time, by does it occur at a steady rate or is it dependent on external factors?
In: Economics
It’s when goods prices go up and so the economy overall inflates to compensate
If I work in a supermarket and I buy bread that is £1, but then the bread goes up to £2, I’d need more money to afford that, so my wages might go up. This in itself isn’t too bad, because as long as my wages rise with it it’s the same thing for me.
It becomes bad because it means the currency is worth less. What that means is that, even though it doesn’t matter to me because my wages rose, what about someone who is living off of their savings? Their bank balance won’t rise, so now that person has the same anount of money but it has less value (because everything is expensive)
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