What is the difference between inflation and deflation

Question

Marisol Valentine

Social Studies

1 March, 02:27

What is the difference between inflation and deflation

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Answers (1)

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Tatiana Santos · Answer 1

Inflation refers to rise in price of goods and services.

Deflation refers to decrease in price of goods and services.

Explanation:

Inflation:

Inflation refers to rise in price of goods and services.

This occurs as a result of increase in demand of goods, due to which it's availability decreases and as a result price increases.

Deflation;

Deflation refers to decrease in price of goods and services.

This occurs as a result of decrease in demand of goods, due to number of goods available in the market increases and as a result price decreases.