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What is the difference between inflation and recession ?

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Inflation is when prices continue to creep upward, usually as a result of overheated economic growth or too much capital in the market chasing too few opportunities. A recession is a general slowdown in economic activity over a long period of time. During recessions, many macroeconomic indicators vary in a similar way. Production as measured by Gross Domestic Product (GDP), employment, investment spending, capacity utilization, household incomes, business profits and inflation all fall during recessions; bankruptcies and the unemployment rate rises. Inflation is generally not present during recession. In fact dis-inflation happens because if recession. Inflation may or may not effect recession, as recession is generally caused by shortage of money supply and not shortage of production. Hope this helps. more
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