Inflation -
Inflation is the steady increase in the price of goods and services over time. It devalues units of currency , resulting in consequences like higher cost of living. Think about how much a candy bar cost when you were a little kid. Now, think about how much that same candy bar costs today. Or, think about how much it cost to rent an apartment in Chennai City in the 1970s. Now think of how much it costs today. That price level increase is inflation.
Example:
One of the most straightforward examples of inflation in action can be seen in the price of milk. In 1913, a liter of milk cost about 16 paisa per liters. One hundred years later, in 2013, a liter of milk cost Rs. 20/-(for Example) nearly ten times higher.
This increase is not due to milk becoming more scarce, or more expensive to make. In fact, the opposite is true. Instead, this price reflects the gradual decrease in the value of money as a result of inflation.