Inflation

What do we NOT measure in money?

• Income and Revenue

• Profits and Losses

• Savings and Capital

• Gross Domestic Production

• National Happiness Index

Who DOES NOT charge interest when you use of their capital?

• Banks

• Parents

• Firms

• Households

Which statement is TRUE?

• Commercial Banks make profits by printing money

• Central Bank operations are completely independent

• Central Bank works for Commercial banks

• Central Bank works for the Government

Why do we NOT completely trust the central banks?

• They must help the government to oversee the economy

• Too much money will cause inflation

• Too little money will cause high interest rates

• Absolute power corrupts absolutely

Why does the Dollar say "in God we trust"?

• Central bank presidents are normally very religious

• USA don't have Chinggis khan as their national leader

• To instil the ultimate confidence in the monetary system

• The expression is an old tradition and is still popular

What causes overall prices to rise, i.e. inflation of prices?

• Shortage of Goods (Demand Pull)

• Increased costs of Production (Cost Push)

• Living costs increasing (built-in)

• If people kind of expect the prices to keep increasing...

• All of the above