(I’m American) Inflation is the rising cost of goods and services. Inflation constantly goes up by varying degrees. When economists say “inflation is decreasing”, that just means that the rate of inflation has slowed, not that inflation reversed.
If inflation is causing money to be less valuable over time, why would it be bad to have deflation? Would that not make my money more valuable? I’ve been told it would be very bad, but not in a way that I understand
In: Economics
Imagine you had $100 to buy a tv today. But tomorrow that tv will cost $90. The day after that? $80. You would wait to purchase the tv until you believed the price hit bottom. But you don’t know when that is. So you delay the purchase forever. No one spending money on goods and services is bad for everyone. So deflation is bad. Mild inflation encourages the purchase of goods and services today which keeps the economy humming along.
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