Day to Day Economics
Anatomy of Inflation
What is inflation… Inflation is a sustained and overall rise in the
general price level.
• Demand-pull inflation.• Cost-push / Supply shock inflation.
Case Study
The formation of the OPEC in 1960 and the subsequent price rise in oil lead to a major increase in the cost of production of many energy-related commodities leading to a supply shock all over the world and consequently a cost-push inflation.
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