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Why does inflation happen?

Asked by Omar S.·6 days ago·254 people helped

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JP

Jules P.

Econ teacher

Economics

Imagine there are more coins going around but the same amount of toys to buy. Everyone waves more coins at the shopkeeper, so the shopkeeper raises the price.

When money becomes more common but things stay the same, each coin buys a little less. That slow rise in prices is inflation.

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