Word of the Day: Inflation

Explanation: Inflation is nothing but a rise in the general level of prices of goods and services in an economy over a period of time.

When the price level rises, each unit of currency buys fewer goods and services; consequently, the purchasing power of money goes down.

High rates of inflation are often caused by an excessive growth of the money supply in the economy.

To put in simple terms:
A kg of apple costing Rs. 50 a few years back costs Rs.100 today – that’s inflation.