Final answer:
The term for a period of rising prices and falling purchasing power of money is inflation. It typically occurs during times of economic growth and contrasts with deflation, which can occur during recessions or depressions.
Step-by-step explanation:
The economic term used to describe a period of rising prices when the purchasing power of the dollar is falling is inflation. Inflation occurs when the general level of prices for goods and services increases, leading to a fall in the purchasing power of money. This means that each dollar you have buys fewer goods and services over time.
During periods of recession or depression, you may actually see lower rates of inflation or even deflation, which is a decrease in the general price level of goods and services. Recessions are characterized by falling real GDP (gross domestic product) and rising unemployment, and they can lead to a reduction in the overall demand for goods, potentially causing deflation. However, during periods of economic expansion, we tend to see higher inflation rates.