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Glossary

  1. Real Value: A value that has been adjusted for inflation.
  2. Nominal Value: A value that is current and not adjusted for inflation.
  3. Demand-Pull Inflation: Inflation that occurs when there is more spending in an economy than the economy has in goods and services.
  4. Cost Push Inflation: A type of inflation caused by an increase in the cost of inputs for businesses.
  5. Stagflation: A unique period of high unemployment and high inflation while the economy remains stagnant or without economic growth.
  6. COLA: Cost of living adjustment for increases in inflation.
  7. Market Basket: The basket of consumer goods used by the Bureau of Labor Statistics to calculate CPI.
  8. Consumer Price Index (CPI): The Consumer Price Index is used to measure inflation. The formula is (price in a specific year/ price in the base year) × 100.
  9. Expected Inflation: Inflation rates that meet the public's expectations.
  10. Unexpected Inflation: An inflation rate that is higher than anyone expected.
  11. Bureau of Labor Statistics: The agency within the Department of Labor tasked with calculating CPI.
  12. Base Year: The year in which the CPI is 100. Currently the BLS uses the years 1982-1984 as the base year.
  13. Percentage or Rate Change: The formula is (New figure − Old Figure / Old Figure) × 100.
  14. Inflation: Usually a period of a rise in the general level of prices associated with a growing economy.
  15. Deflation: Usually a period of a decline in the general level of prices associated with a shrinking economy.
  16. Hyperinflation: Inflation occurring at a very high rate.