What is the meaning of inflation when speaking of US economy?
Answer:
Inflation means prices are going up on everything, because the dollar is losing value.
You see, the supply & demand ratio works on money too. The more money put into circulation the "LESS" valuable the money becomes, therefore you need more dollars to buy things.
High prices cause people to spend less, and if it gets bad enough companies that produce things start to lay off workers, people travel less, and the whole country can slide into recession or depression which ever you want to call it.
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