Definition:
Inflation is an increase in the price of goods and services that is sustained over time. As inflation increases, your purchasing power decreases. Your dollar will buy fewer and fewer goods and services. Inflation is usually measured as an annual percentage.
Most developed countries have a low level of inflation that is considered normal. Inflation is considered a problem when wages don't keep up. The lack of any inflation may indicate a weakening economy.
Also Known As: rise, increase, boom, expanse, spread
Examples:
If inflation is 6% this year, then something that cost $1 last year will cost $1.06 this year.
