Cost push inflation is caused by a rise in the cost of production. When the cost of production increases, the firms try to maintain their profit margin by increasing the price of goods and services. As a result, the general price level increases, leading to inflation. For example, if the cost of raw materials or labour increases, the firms will have to spend more money to produce the same amount of goods. To maintain their profit margin, they will increase the price of the goods, leading to an increase in the general price level. This is known as cost-push inflation.