As inflation rises, consumer spending declines because when prices go up, people can’t afford to buy as much.
Inflation is a measure of purchasing power. It’s defined as the rate at which the prices of products and services change over a given period (usually a year). Simply put, when inflation rises, consumer spending declines because when prices go up, people can’t afford to buy as much.
What Is Inflation? Definition, Formula & What It Means For You
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