Inflation in Canada Recessions and unemployment are trouble enough, but many people in the modern world see a danger in too much prosperity. The danger is inflation. Inflation is defined as an increase in the average price level in the economy. The amount of inflation is measured by the consumer price index (CPI) and producer price indexes (PPI). As inflation goes up, there is a decline in the purchasing power of money (Investopedia, 2002, P.2). Thinking …showed first 75 words of 954 total…

…showed last 75 words of 954 total…framework that achieves price stability or very low inflation, monetary policy can facilitate saving and investment decisions, thus allowing the business sector to focus on cutting costs and increasing productivity, rather than expending energy and resources to protect itself against inflation. Canada has done a good job in controlling inflation. The rate of inflation did not go too high, which results in a healthy economy in Canada and a high standard of living for Canadians.