Inflation

Extremely rapid inflation with the price level rising by at least fifty per cent each month

• Hyperinflation

• Stagnation

• Deflation

• Inflation

Level of GDP where all available factor inputs are fully employed

• Cost push inflation

• Consumer price Index

• Full capacity output

• Relative deflation

Prices driven higher due to an increase in higher unit wages, import prices, indirect taxes etc

• Demand Pull

• Cost push

Combination of slow growth and fast-rising prices

• Hyperinflation

• Demand pull

• Cost plus

• Staglfation

Nominal wage adjusted for inflation

• Living wage

• RPI

• Real wage

• Constant prices

Rising prices resulting from a high level of aggregate demand relative to potential output

• Demand Pull

• Cost Push

Is this showing...

• Demand Pull

• Cost Push

When inflation is high the _______________ of the GBP decreases

If CPI goes from 100 to 300 and your salary goes from £100,000 to £200,000, what happened to your purchasing power?

• No change

• Increases

• Decreases