Inflation occurs when the prices of goods and services increase in an economy. The ability of a currency to purchase the same quantity of goods decreases its value during periods of inflation. Inflation is triggered by a variety of factors.
Causes of inflation in Economics
Cost-Push inflation
Demand-pull inflation
Printing Money
Public Spending
Velocity of Circulation
Population
Hoarding
Shortage
Exports
Trade Union
Devaluation
Tax Reduction
People are more likely to make use of their assets once the state reduces taxes. Additionally, increased demand for goods and services results from lower taxes; However, inflation occurs when the production rate cannot keep up with demand.