What is inflation and list the advantages and disadvantages of inflation

Hey there!

Inflation is the devaluation of money. For example, remember "back in the old days" when things were much cheaper? When a quarter was worth an entire soda can? Now, it can be almost $2 for just a soda can. This is because of inflation. Money loses it's value, and therefore things become more expensive then they usually are.

There are, however, a few advantages. Moderate inflation allows real adjustment of wages, and inflation is better than deflation - the opposite of inflation, and can cause recession. Moderate inflation also allows economic growth.

There are also many disadvantages to inflation. Wages can become out of control, and things become more expensive. High inflation can lead to lower economic growth, too.

Hope it helps, and have a great day! Good luck!

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