Prices go up when people have more money. Imagine you and all your friends get a bigger allowance, so you can buy more toys. But if there aren’t enough toys to go around, the toy store raises prices because everyone wants them now. This is like inflation, it's when things cost more money even though people are getting richer.
Examples
- Your friend gets a new video game for $20 because everyone wants it now.
- The pizza place raises prices after your whole class orders pizzas at the same time.
- Your mom buys more apples, but they're twice as expensive this week.
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See also
- Why Do Inflation Rates Go Up When Everyone Is Paying More?
- Why Do Inflation Rates Feel So Wild?
- Why Is Inflation Like a Broken Scale?
- Why Do Inflation Rates Feel So Random?
- How does inflation affect the average person's savings?