Your grandmother tells you a dollar doesn’t go as far as it used to. She says the “purchasing power” of a dollar is much less than it used to be. Explain what she means. Try to use and explain terms like inflation and deflation in your answer.(write like an 8th grader, 2 sentences)

Answer 1

When your grandmother says a dollar doesn’t go as far as it used to, she means that the amount of things you can buy with a dollar has changed because of something called inflation. Inflation is when prices go up over time, so even though a dollar is still a dollar, it buys less stuff now than it did in the past.