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Module 14
Inflation: An Overview
9
Economics
12th Grade
02/24/2013

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Cards

Term
real wage
Definition
The wage divided by the price level.
Term
real income
Definition
Income divided by the price level.
Term
inflation rate
Definition
The percent change per year in a price index- typically the consumer price index.
Term
shoe-leather costs
Definition
The increased costs of transactions caused by inflation.
Term
menu costs
Definition
The real costs of changing listed prices.
Term
unit-of-account costs
Definition
Arise from the way inflation makes money a less reliable unit of measurement.
Term
nominal interest rate
Definition
The interest rate actually paid for a loan.
Term
real interest rate
Definition
The nominal interest rate minus the rate of inflation.
Term
disinflation
Definition
The process of bringing the inflation rate down.
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