Econ Chapter 13 Self-Assessment

(I)

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

(K)

What causes cost push (aggregate supply) inflation

• An increase in demand for goods and services

• An increase in supply

• A rise in production costs passed on to consumers

• A fall in the price of imports

(J)

What causes demand pull (aggregate demand) 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

(I)

What is inflation?

• rise in all prices

• rise in most prices

• rise in some prices

• rise in general prices

(I, J, K)

What 2 main types of inflation are there?

• demand pull (aggregate demand) and cost push (aggregate supply)

• demand pull (aggregate demand) and supply glut

• supply glut and demand side

• supply inflation and demand inflation

(I)

What the definition of deflation?

• decrease in the average price of goods and services

• occurs when the price of goods and services rise

• increase in prices

• I don't know

The federal government decreases spending by $44 billion dollars. This would cause a shift from

• AD 1 to AD 2
• AD 1 to AD 3
• AD 2 to AD 3

According to the wage-price spiral, if a company gives a worker a raise in pay, what must they also do?

•  Raise the price of their products
• go out of business
• lower the price of their products

(I)

Walter gets a 2% pay increase. The inflation rate is 3%

• helped by inflation

• hurt by inflation

Which of these is not a cause of poverty in The United States

• Lack of Education

• lowering of nation's GDP

• Location (inner cities)

• racial and gender discrimination