1. Inflation is defined as a sustained increase in the general price level for goods and services caused by too much money chasing too few goods. 2. There are different types of inflation including moderate, creeping, stagflation, demand-pull, and cost-push inflation. 3. The effects of inflation include a loss of confidence in the value of money, a wider gap in income distribution, inefficiency in output and quality, and potentially increased investment and output. Anti-inflation measures involve monetary, fiscal and direct control policies.