Demand-pull inflation

Imagine if you and all your friends wanted to buy the same toy. The store only has a few toys left, so the price of the toy goes up. This is like demand-pull inflation.

When lots of people want to buy the same thing, the price usually goes up because there's only a limited amount of it. This can happen with everything from toys to food to gas.

In the economy, this happens when lots of people want to buy goods and services, but there aren't enough of them to meet everyone's demand. This causes prices to rise, which is called demand-pull inflation.