Combating Inflation: Insights from Forbes Comprehensive Guide

Inflation: What It Is, Why It’s Bad, and How to Fix It Book Analysis Name Institutional Affiliation Course name Instructor’s name Assignment due date Inflation: What It Is, Why It’s Bad, and How to Fix It Book Analysis Inflation is a major problem that affects economies, the consumers, and the businesses in the market. The current paper is a book review for Steve Forbes’s Inflation: What It Is, Why It’s Bad, and How to Fix It. The book has six chapters describing the problem, its historical moments, and solutions for governments, consumers, and businesses. Inflation raises the costs of products and services in the market and makes it harder for businesses to access key raw materials. While it may raise employment levels, inflation leads to the devaluation of currency and the value of assets in a country. Previous attempts to respond to the problem have failed since governments fail to implement the solutions appropriately and mostly focus on the symptoms of the problem (Hasenzagl et al., 2022). Forbes’s book demonstrates that inflation has significant effects on economies, consumers, and businesses and the players in the market should focus on the long-term solutions to the problem by relying on economic and historical data to make financial decisions and investments. Definition of Inflation Inflation is the state of an economy where there is a significant increase in the prices of products and services in key markets. Economists measure the level of inflation by determining the Consumer Price Index (CPI) at a specific period or in a particular country. CPI is the percentage change in the average prices of a basked of goods and services that are necessities in the majority of households. There is inflation when the CPI is high meaning that consumers pay more for goods and services (Hasenzagl et al., 2022). Causes of inflation include the increase in the average wages of workers in an economy leading to an increase in the amount of money they have for expenditure. An increase in the prices of raw materials may inc