This document defines inflation as a sharp upward movement in price levels according to R.P. Kent, and as too much money chasing too few goods according to W. Acolborn. It identifies two types of inflation: demand-pull inflation, which occurs when increasing demand for goods and services drives prices up, and cost-push inflation, which occurs when costs of production increase. The effects of inflation include currency depreciation against other currencies, declining exports and increasing imports and standards of living, and increased poverty levels. Cost-push inflation specifically results from increases in costs of factors of production.