Answer:

There are four main drivers behind inflation. Among them are cost-push inflation, or the decrease in the aggregate supply of goods and services stemming from an increase in the cost of production, and demand-pull inflation, or the increase in aggregate demand, categorized by the four sections of the macroeconomy: households, business, governments, and foreign buyers. The two other contributing factors to inflation include an increase in the money supply of an economy and a decrease in the demand for money.

Inflation is the rate at which the general price level of goods and services rises. This, in turn, causes a drop in purchasing power. This is not to be confused with the change in the prices of individual goods and services, which rise and fall all the time. Inflation happens when prices rise across the economy to a certain degree.

Explanation:

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