Economics (9-1) - 0987 CIE

Inflation

Gbogbo ọrọ náà

When prices creep up year after year, the money in your pocket buys less and less. Inflation is the sustained rise in the general price level, and it quietly reshapes who wins and who loses across the whole economy, punishing savers and fixed-income earners while easing the burden on borrowers.

In this lesson you will learn how inflation is measured with the Consumer Prices Index, calculate an inflation rate from index numbers, and separate its two main causes, demand-pull and cost-push. You will trace its consequences for savers, lenders, borrowers, consumers, workers and firms, and weigh the policies used to control it. By the end you will be able to measure, explain and evaluate inflation with confidence.

Ebumnobi

measurement of inflation using the Consumer Prices Index (CPI)
demand-pull
cost-push
how inflation affects savers, lenders and borrowers
consequences of inflation for consumers, workers, producers/firms and the economy
the range of policies available to control inflation and their effectiveness

Akọmọ Ojú-ẹkọ

Stable prices are one of the four main goals of government, and inflation touches every household and firm. Knowing how it is measured, what causes it and who it hurts lets you analyse a huge range of macroeconomic questions, and the CPI calculation is a reliable source of exam marks.

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Ayẹwo Ẹkọ

Ekele diri gi maka imecha ihe karịrị na Inflation. Ugbu a na ị na-enyochakwa isi echiche na echiche ndị dị mkpa, ọ bụ oge iji nwalee ihe ị ma. Ngwa a na-enye ụdị ajụjụ ọmụmụ dị iche iche emebere iji kwado nghọta gị wee nyere gị aka ịmata otú ị ghọtara ihe ndị a kụziri.

Ị ga-ahụ ngwakọta nke ụdị ajụjụ dị iche iche, gụnyere ajụjụ chọrọ ịhọrọ otu n’ime ọtụtụ azịza, ajụjụ chọrọ mkpirisi azịza, na ajụjụ ede ede. A na-arụpụta ajụjụ ọ bụla nke ọma iji nwalee akụkụ dị iche iche nke ihe ọmụma gị na nkà nke ịtụgharị uche.

Jiri akụkụ a nke nyocha ka ohere iji kụziere ihe ị matara banyere isiokwu ahụ ma chọpụta ebe ọ bụla ị nwere ike ịchọ ọmụmụ ihe ọzọ. Ekwela ka nsogbu ọ bụla ị na-eche ihu mee ka ị daa mba; kama, lee ha anya dị ka ohere maka ịzụlite onwe gị na imeziwanye.

Inflation is best defined as: A. a high level of prices B. a sustained rise in the general price level C. a rise in one product's price D. a fall in the value of exports Answer: B
A country's CPI rises from 100 to 108 in a year. The inflation rate is: A. 108% B. 8% C. 0.8% D. 1.08% Answer: B
Inflation caused by total demand rising faster than supply is called: A. cost-push inflation B. imported inflation C. demand-pull inflation D. deflation Answer: C
During inflation, which group is most likely to gain? A. savers B. lenders C. borrowers D. fixed-income pensioners Answer: C
Which policy directly targets demand-pull inflation? A. raising interest rates to reduce spending B. subsidising firms' costs C. cutting income tax D. increasing government spending Answer: A