Question

Inflation is the state in which ..............................

Answer 1

Inflation is the state in which flow of money increase in the market.

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Answer 2

• Inflation is a state in which the price increase over a given period.  
• It means the overall increase or the increase in the cost of living in a country.  
• Inflation occurs when the price rise due to an increase in the production cost such as raw materials and wages.
• A sudden increase in the quantity demanded products and services can also cause inflation.
• This is because when the quantity increases the price of goods increases and the consumers are also willing to pay more for the product.  
• When the prices increase due to an increase in the raw materials or the production cost it is known as cost-push inflation.
• Prices increase due to an increase in demand it is known as demand push inflation.
• There are four main types of inflation which are categorized by speed.  They are creeping walking galloping and hyperinflation.