What's inflation?
What's inflation? Inlation happens when prices rise and the value of our money falls. In 1980, for example, a movie ticket cost on average $2.89. By 2019, the average price of a movie ticket had risen to $9.16. What causes inflation? Inflation can occur when prices rise due to increases in production costs, such as raw materials and wages . A surge in demand for products and services can cause inflation as consumers are willing to pay more for the product. Is inflation always bad? Inflation isn't always bad news. A little bit is actually quite healthy for an economy . If prices are falling – something known as deflation – companies may be hesitant to invest in new plants and equipment, and unemployment might rise. What happens when inflation hits? But inflation increases your cost of living . If the inflation is high , it hurts the economy. Rising prices may be an indication of an economy growing very fast. People buy more than they need to avoid to