Chapter 4: Inflation and Deflation

In this section

• Measuring Inflation (CPI, PPI, GDP Deflator)
  Measuring Inflation (CPI, PPI, GDP Deflator) (CFA Level 1): Why Measuring Inflation Matters, Consumer Price Index (CPI), and Key Features. Key definitions, formulas, and exam tips.
• The Quantity Theory of Money
  The Quantity Theory of Money (CFA Level 1): Short-Run vs. Long-Run Dynamics, Mechanism and Policy Relevance, and Modern Monetarism and Policy Approaches. Key definitions, formulas, and exam tips.
• Causes and Types of Inflation (Demand‐Pull vs. Cost‐Push)
  Causes and Types of Inflation (Demand‐Pull vs. Cost‐Push) (CFA Level 1): Demand-Pull Inflation, Demand-Pull Inflation in the AD/AS Model, and Cost-Push Inflation. Key definitions, formulas, and exam tips.
• Consequences of Inflation and Deflation
  Consequences of Inflation and Deflation (CFA Level 1): Big Picture, Consequences of Inflation, and Reduced Purchasing Power. Key definitions, formulas, and exam tips.
• The Phillips Curve and Price Stability
  The Phillips Curve and Price Stability (CFA Level 1): Phillips Curve in the Short Run, Phillips Curve in the Long Run, and Role of Inflation Expectations. Key definitions, formulas, and exam tips.
• Stagflation and Supply Shocks
  Stagflation and Supply Shocks (CFA Level 1): Understanding Stagflation, Negative and Positive Supply Shocks, and Negative Supply Shocks. Key definitions, formulas, and exam tips.
• Hyperinflation and Historical Perspectives
  Hyperinflation and Historical Perspectives (CFA Level 1): What Is Hyperinflation?, Typical Causes of Hyperinflation, and Economic and Social Fallout. Key definitions, formulas, and exam tips.
• Core vs. Headline Inflation Measures
  Core vs. Headline Inflation Measures (CFA Level 1): Headline Inflation, Influence of Commodity Swings, and Core Inflation. Key definitions, formulas, and exam tips.