Inflation
A general rise in the prices of goods and services across the economy over time.
Inflation erodes the purchasing power of savings, and expected inflation can discourage saving, because a dollar spent today buys more than the same dollar spent later.
Often Confused With
- Lifestyle Inflation
- Inflation is an economy-wide price rise; lifestyle inflation is one household's spending rising with income.
Taught In
See Also
3.1.B.2