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S E28: Inflation - When money loses its value

Think Like An Economist

CHAPTER

Is Inflation a Bas Thing for the Economy?

An economist would look at the spending power of your current wage in real dollars. So even though my nominal wage has risen, my real wage is unchanged because what i can buy with it hasn't changed. Sometimes when prices are rising, people will switch from buying the stuff that becomes more expensive to the stuff that's not becoming more expensive. The cost of living isn't rising quite as fast as the official statistics say.

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