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Less than two years later, in November 1922, the same newspaper cost 70,000,000 marks. All other prices in the economy rose by similar amounts. This occurrence is one of history’s most spectacular examples of inflation, an increase in the overall level of prices in the economy (Principles of Economics, N.Gregory Mankiw, Chapter 1, p.13). When prices go up, the cost of money decreases and your purchasing power consequently goes down. For example, with 3% inflation, the price of a $100 T-shirt today would be 103$ next year. In short-term, inflation may seem not worth mentioning; however, in long-term it will lower the standard of living...
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