Business & Finance

Why Everyday Prices Keep Rising

An explanation of how inflation works and why the cost of daily life keeps going up.

B29 min

Lesson progress0 / 11 sentences

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1The price of bread at our local shop has risen three times this year.

2Milk, eggs, and bus tickets all cost more than they did last year.

3Economists call this general rise in everyday prices inflation across the whole economy.

4It often happens when demand for goods grows faster than the supply of them.

5Higher energy costs also push up the price of almost everything we buy.

6Shop owners pay more for transport, so they charge their customers more.

7Workers then ask their bosses for higher pay to keep up with bills.

8Higher wages then raise business costs once again, and so the circle continues onward.

9Governments and central banks try to slow inflation with higher interest rates.

10That makes loans more expensive, so people spend and borrow less money.

11Slowly, prices calm down once again, though nobody feels fully satisfied with the result.

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