Abstract: Publisher Summary
This chapter discusses inflation. It focuses on the economic impacts of inflation, the winners and losers that inflation generates, and the price indices that are used to measure inflation. Inflation is defined to be a substantial, sustained increase in the general level of prices; however, all price increases are not inflation. Changes in individual prices resulting from individual market conditions do not constitute inflation. Inflation occurs when a large number of prices around the economy are rising together, creating an increase in the average price of the things that one buys. Inflation is measured using price indices. A price index considers the total cost of a fixed market basket of goods in different years. There are three main measures of inflation in the US. The Consumer Price Index looks at retail prices paid by urban consumers, while The Producer Price Index measures the prices that businesses pay. The gross national product implicit price deflator index measures the prices of all new goods.
Publication Year: 1981
Publication Date: 1981-01-01
Language: en
Type: book-chapter
Indexed In: ['crossref']
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