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Inflation in Modern Economies

Learn about inflation, how it is measured, its advantages and disadvantages, and its role in shaping modern economies.

Publisher: Khan Academy
This free online course in inflation will teach you about the role inflation plays in modern economies and the impact it can have on the life of an average person. Inflation is defined as the rate at which the average price of goods and services in an economy increases over a period of time. It is the regular rise in the general level of prices where a unit of currency buys less than it did in the previous years.
Inflation in Modern Economies
  • Duration

    1.5-3 Hours
  • Students

  • Accreditation






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This course starts off by explaining the meaning of inflation, how it is measured, and how it affects the average person's life. It then shows you data about inflation going up and down during a course of a year. You will learn the exact meaning of deflation and hyperinflation, and how they are used when discussing inflation. You will also cover how inflation comes about from prices rising in response to a fall in the supply of common goods and services.

You will then study the reason why good economies tend to be associated with a moderate level of inflation, along with the strange circumstance where there is inflation and stagnation at the same time. You will also cover how stagflation causes massive inflation in one part of the economy while affecting other parts of the economy differently. Finally, the course will cover the negative effects of higher inflation and you will be given an overview of macroeconomics.

Many of us have, at some point or another, heard our grandparents talk about how a candy bar cost barely anything during their childhood. In the nineteen hundreds, a Hershey's chocolate bar cost just 2 cents. Today, that same chocolate bar costs $1.35. Why the big difference in its price? Inflation. As we can see, inflation impacts even the little things in the average person's daily life. Check out this course and learn more about inflation now.

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