The tendency for prices to rise while the value of money fall is known as

  • A bills of exchange
  • B inflation
  • C depreciation
  • D deflation

The correct answer is B. inflation

The tendency for prices to rise while the value of money falls is known as B. inflation.

Inflation is an economic term that refers to an environment of generally rising prices of goods and services within a particular economy.

As general prices rise, with all other things being equal, the purchasing power of currency tends to fall. Hence, inflation reflects a reduction in the purchasing power per unit of money.

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