Inflation

Inflation

by Shauna-Kay Herah-Thompson

Multiple Choice

What is inflation?

• rise in all prices
• rise in most prices
• rise in some prices
• rise in general prices

Multiple Choice

An index that measures the prices of a market basket of goods that typical consumers purchase.

• Consumer Price Index
• Federal Reserve
• Bank
• Deflation

Multiple Choice

What causes demand pull inflation?

• rise in price due to a decrease in supply
• a rise in price level due to an increase in consumption
• a rise in price due to an increase in the cost of production
• a decrease in price due to a decrease in supply

Multiple Choice

What 2 types of inflation are there?

• demand pull and cost push
• demand pull and supply glut
• supply glut and demand side
• supply inflation and demand inflation

Multiple Choice

What is Cost-push inflation?

• The decrease prices of the factors of the production leads to decreased supply of these goods.

• The increase prices of the factors of the production leads to a decreased supply of these goods.

Multiple Choice

When inflation is high the _______________of the dollar decreases

• cost value
• purchasing power
• importance
• validity

Multiple Choice

Who is most likely to be hurt by inflation?

• someone who borrowed money
• a retiree on a fixed income
• a business owner
• the U.S. government

Multiple Choice

To correct inflation the government need to boost demand

• TRUE

• FALSE

Multiple Choice

What type of monetary policy is used to correct inflation?

• Expansionary

• Contractionary