Inflation basictly means the depreciation of money. So if inflation is 25%, then the money I have should be worth 25% than it was last year.
You're missing a word in there. I assume you meant worth 25% less than it was last year, but that's not quite right.
Imagine a money supply of $100, with an annual inflation rate of 25%. That means the following year the money supply is at $125.
What does this do to prices? If the supply of goods that money can buy remains static you have more money chasing the same pool of goods, so all things remaining equal (demand, etc.) prices would rise. A widget that cost $10 when the money supply was at $100 would cost $12.5. Your $10 saved from last year would have 80% of the purchasing power it had last year, a 20% loss, after the 25% increase in money supply.
What happened to your 20% of purchasing power? It was taken in effect by the government when they issued a bond. Their borrowing serves as the basis for fractional bank reserves so that banks can increase the money supply - giving your purchasing power to whoever will pay the bank's interest rates. It can also be taken by central bank purchases of bonds - the central bank being authorized to print money for that transaction, and thereby increasing the money supply.
The reality is, all other things don't remain equal. Productivity improves, driving down costs, production increases, driving down costs, and consumers are constantly presented new alternatives in competition, which compels producers to keep down costs. Even if the supply of goods rose in perfect concert with the supply of money people might not feel like buying additional units of the goods they bought last year. There is a diminishing sense of satisfaction in purchasing additional goods, just because you have more money this year doesn't mean you feel the need to have two digital cameras.
Quantifying the subjective consumer's decisions is folly, but the government tries to in order to assure it isn't creating so much excess money to fund itself that it destabilizes the capital structure of the actual wealth producing sectors of the economy. The more loans underwritten to inflate the money supply mean more defaults - wealth lost in consumption, or non-profitable enterprises. The pool of successful entrepeneurs isn't limitless, and interest rates are supposed to direct the capital to those who are best at handling it. Inflating the money supply subverts this market efficiency, and monetary deflation is the consequence when the bad loans come due.
Increasing GDP figures debased with high inflation should not be considered economic growth. Price deflation is the norm of growing economies (as the goods grow relative to money supply), and obvious everywhere in the economy around us except where productivity gains are overwhelmed by inflation or union restrictions on the labor supply.
Increasing economic growth should be represented with real GDP growth, which is accentuated by increasing the portion of the economy dedicated to wealth generation (reducing government consumption as a percentage of real GDP).
You cannot in real life, and should not in the game, be able to print your way to prosperity.
, this way u simulate inflation just a bit better and rewards players for keeping inflation in check and an healthy economy 
