⚫What is inflation?⚫ And Kinds of inflation.

In the words of Silverman.

⚫The term inflation is used for the increase in the supply money which is in excess of the required demand of money for exchange in transactions and which results in the rise of general price_level.

▪️▪️▪️Crowthy defines inflation ..▪️▪️▪️▪️

   Inflation denotes that state of affairs where the value of money goes down or in other words price goose up.

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📝Kinds

     There are two kinds of Inflation 


    (1).    Demand _pull⬆️

     (2).   Cost push ⬆️

⚫Demand_ pull inflation:

                                   This kind of inflation occurs when there is a rise in the demand of goods and services.

Demand for goods and services rises due to several factors such as population growth, increase in the development expenditure of the government and upward trend in private investment and consumption etc .

⚫Cost _push inflation:

                              This kind of inflation occurs when there is a rise in the cost of production of goods.

When the cost of production increases the producers in order to protect their profit, raise the prices.
The main cause of increase in the cost of production are. Wages _raises under the pressing demands of labour unions , government duties and rising prices of imported raw material.

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This article is taken from Islamic economics by ⚫Pro.Abdul Hameed Dar
⚫Prof. Mian Muhammad Akram.