2.1.2 Causes of Inflation (Edexcel A-Level Economics Teaching PowerPoint)

This teaching powerpoint covers Causes of Inflation

Generally speaking, economists believe that there are two main causes of inflation: demand-pull inflation and cost-push inflation. Demand-pull inflation occurs when demand for goods and services in an economy outstrips the available supply. This can be caused by factors such as rising incomes, population growth, or increased government spending. Cost-push inflation happens when the cost of producing goods and services goes up, leading businesses to raise their prices. This can be caused by factors such as higher wages, energy prices, or the cost of raw materials.