Inflation

Inflation is...

• A measure of price change

• An increase in the rate of price increase

• An increase in general price levels

• A decrease in general price level

How is inflation measured?

• By comparing average prices of all goods and services produced

• Consumer Price Index

• Producer Price index

• Government Price Index

What is the UK target rate of inflation?

• 1%

• 2%

• 3%

• 4%

A decrease in general price level is called...

• Hyperinflation

• Low inflation

• Deflation

• Disinflation

Inflation caused by a rise in wage rates would be classified as..

• Demand pull

• Demand push

• Cost push

• Cost pull

Inflation caused by an increase in consumption would be classified as..

• Demand pull

• Demand push

• Cost push

• Cost pull

During a recession, inflation is likely to be..

• High

• Low

A consequence of high inflation is that it benefits borrowers.

• True

• False

Which of the following measure of inflation includes mortage costs?

• CPI

• RPI

• CPIH

• RPIH

As at October 2021 what was the CPI rate of inflation?

• 3.1%

• 4%

• 4.2%

• 3.2%