Introduction to inflation | Inflation - measuring the cost of living | Macroeconomics | Khan Academy

Basics of price inflation and the CPI (consumer price index)

Macroeconomics on Khan Academy: Topics covered in a traditional college level introductory macroeconomics course

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[owoadeenoch]

I'M NEW TO BTC AND I'VE BEEN MAKING LOSSES TRYING TO MAKE PROFIT MYSELF IN TRADING...I THOUGHT TRADING ON DEMO ACCOUNT IS JUST LIKE TRADING THE REAL MARKET... CAN ANYONE HELP ME OUT OR AT LEAST ADVICE ME ON WHAT TO DO?

[almaibarra]

I knew things just got real when the math guy pulled out the calculator.

[Rondadoreronda]

In Japan we have been suffering from deflation for 20 years. Under the deflation supply decreases and companies go bankrupt. Of course, many Japanese companies have gone. In addition, the companies depending on exports have been damaged by strong yen. But the productivity of survival ones have been high by the rationalization of management. So they've managed to survive. Now Japanese government and the central bank decided to print lots of money to accelerate inflation. I appreciate it.

[maryblake]

<< >>Inflation is killing my budget and my salary. I can't invest and it seems like I will need to sell all of my risk assets to keep my head above the water this year.<<>>
What is the best solution right now? These are really though times.

[angelincognitofilms]

Dude, you have no idea how much your videos have saved me. You'll never know. Thanks so much!

[VickiBee]

My mom and dad used to blame inflation on Jimmy Carter.
They blamed the oil crisis on him too.
I was in Grade School then. I didn't have an opinion on the matter, but I wondered how they knew all that.

[CommandoX]

One has to love the digitized TI-85 calculator. ;D

[michaelsvoboda]

Why exactly is a little inflation good? That's a dubious assertion...

[andreirocks]

Hi there! Can you do more Science videos please :) ? You were on to something with Computer Science, and Physics.

[rucaskeeper]

Sir good videos. I have a question: does the inflation has intonaccount the increase in human population
?

[ChooseAname]

That doesn't sound at all like a bad thing. is it?
btw thank you for your answers.

[quinnfowler]

Increasing the money supply is 1 of 2 ways to reverse price inflation.
Whenever prices are too high, we try to switch to a different form of currency that's in greater supply.
We are still transitioning to electronic currency. The only other way is to lower our demand for money.
When our demand for a good exceeds the supply, a price is set to lower demand. The more our demands exceed supply, the higher the prices should be.
So when the supply exceeds demand, we make everything free, only charging people for obscene waste.

[ameyapatil]

Great explaination Sir.At the same time, have a look at this video as well.

[noahschmartz]

only Khan could know the exact question i had and and answer it in the first 25 seconds of the video.

[omgiheartpie]

@SecondWindd The principal and defining tenet of Austrian economic theory after unfettered markets is the notion that free market economies inevitably produce general price deflation and that inflation is strictly defined as an increase in the money supply. I'm not making any value judgments as your comment seems to imply; I'm simply deducing from his comment and apparent interpretation of how a free market economy should partly work that he wouldn't favor Quantitative Easing.

[luxorien]

@utubeknight I am just a student so take this with a grain of salt, but I think it's because money represents our labor. So, if we become more productive, we need more money to represent that added value. Maybe?

[MontyPython]

I have a question, do both regular CPI and CPI-U account for % of income of the individual goods considered?

[MONEYANDTIME]

Although too much inflation is a problem, deflation is an even greater problem to the economy. So much stimulus check and money have been pumped into the economy to mainly avoid a massive deflation. If inflation does not follow, more and more money will be pumped into the economy, basically until we all start spending.

[kelcamer]

Why do most economists think small amounts of inflation are good for an economy? It seems to me that if you have no inflation at all, the prices of goods would become lower since companies would compete for the best quality and lowest price goods, and then consumers could purchase more, so total wealth in the country would increase. And certainly the way to prevent inflation is to adhere to a monetary standard, such as gold.

[omgiheartpie]

@SecondWindd I'm a Keynesian actually, and you pretty much summed up what I've thought all along.