Some of the major characteristics or features of inflation can be described as follows:
1. Rise In Price
It is a process of real rise in price level. Price of the products will become high because of inflation.
2. Monetary Phenomenon
The main cause of inflation is excessive supply of money in the economy. Therefore, it can be considered as a monetary phenomenon.
3. Dynamic Process
It is a dynamic and long-term process of declining in the value of money.
4. Demand And Supply
If the demand is very high and supply is limited, it leads to inflation. So, demand and supply are also responsible for inflation.
5. Decrease In The Value
Purchasing power of money or its value will be decreased because of inflation. So, people have to spend more money to buy products or services.
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6. Uncertainty
Inflation leads to uncertainty in the economy and decrease in investment.
7. Controllable
Inflation can be controlled by taking various steps such as controlling the supply of money in the market, reducing expenditure, increasing interest rate etc.
