Built-in inflation

Okay, imagine you have a toy that costs $5. But next year, that same toy might cost $5.50 even though it's still the same toy. This is called inflation. Now, built-in inflation is when the people who make the toy know that the price will go up next year because maybe they have to pay their workers more or the cost of making the toy has gone up. So they increase the price of the toy now by a little bit to help cover those future costs. It's like when your parents buy you clothes a little bit bigger so you can grow into them. The toy company is doing the same thing by increasing the price a little bit now to help cover future costs. But sometimes this can make it harder for people to afford things, especially if their money doesn't go up at the same rate as inflation.