Economic Development Indices Questions
The inflation rate (IR) is a measure of the percentage change in the average price level of goods and services in an economy over a specific period of time, typically a year. It is calculated by comparing the Consumer Price Index (CPI) or the Producer Price Index (PPI) of the current year with that of the previous year. The IR is an important economic indicator as it reflects the rate at which the purchasing power of a currency is eroded and can have significant impacts on various aspects of the economy, including interest rates, investment decisions, and consumer behavior.