Which is the best definition of inflation? a gradual decrease in the price of goods and services a gradual increase in the price of goods and services an exponential decrease in the price of goods and services an exponential increase in the price of goods and services
Answers
Inflation is associated with:
1) An increase in prices.
2) A low purchasing value of money.
From this we can get the best definition of inflation.
In inflation We can buy fewer goods with the same amount of money that we would buy more similar goods in the past.
Inflation normally happens very fast and it can be sudden.
The increase of prices is thus exponential.
We use exponential when something is increasing very quickly.
From the explanation above the correct answer is :
Inflation is an exponential increase in the price of goods and services.
Inflation is defined as the general increase in the prices of services and goods, as a result of which the purchasing power of the currency decreases. It takes place gradually over a period of time.
The correct option from the ones given in the question is “a gradual increase in the price of goods and services.”