Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
A decrease in the general price level of goods and services
B
An increase in the general price level of goods and services
C
A stable price level in the economy
D
A measure of economic growth
Understanding the Answer
Let's break down why this is correct
Answer
Inflation is when the prices of goods and services in an economy increase over time. This means that the money people have buys less than it used to, which can make it harder for families to afford things like food or rent. For example, if a loaf of bread costs $1 today and next year it costs $1. 10, that’s a 10% inflation rate. Inflation can happen for various reasons, such as when demand for products is higher than what is available, or when production costs increase.
Detailed Explanation
Inflation means prices go up. Other options are incorrect because Some might think inflation means prices go down; A stable price level means prices don’t change much.
Key Concepts
inflation
Topic
Explaining Economic Changes
Difficulty
easy level question
Cognitive Level
understand
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