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How is inflation caused?

Updated: 8/22/2023
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Wiki User

11y ago

Best Answer

we get two types of inflation

demand-pull inflation, this inflation is happened from demand increase, the demand increase, the price gonna increase too. the cpi ( inflation ) index also increase.

another type is cost-push inflation, this type is from cost increase. the wage rate and the price of raw materials increase, the cost of goods and service going up, and the price of goods and services also going up. that's the reason why inflation happened.

hope this can help you

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Wiki User

11y ago
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Wiki User

9y ago

There are many causes for different types of inflation. Some causes include government spending, an increase in public spending, and a drop in aggregate supply.

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Wiki User

11y ago

Because the congress printed hundreds of millions of dollars worth of paper money

that soon lost its value because there was not enough gold and silver to back it

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Wiki User

12y ago

inflation happens because increase and decrease in growth domestic product and also in food it will be happen

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Anonymous

Lvl 1
3y ago

when consumers have more disposable income. A+

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