Inflation Masterclass

Inflation is a measure of the rate of rising prices of goods and services in an economy. True or False?

• True

• False

Inflation does not erode the purchasing power of a currency over time. True or False?

• True

• False

_______ inflation happens when the demand for certain goods and services is greater than the economy's ability to meet those demands.

• Left-right

• Demand-pull

• High-low

• None of the above

______ can increase the rate of production and thus increase in inflation.

• Decreased production

• Increased money supply

• Decline in economy

• All of the above

Cost-push inflation is the increase of prices of goods when the cost of wages and materials used in production of goods goes up. True or False?

• True

• False

Inflation is good for?

• Asset owners

• Business owners

• Both

When companies or government needs funds, they can ask the public to offer them funds as a loan. This tool is called ______________.

• Bonds

• Mutual Fund

• Equities

• None of the above

What is the inflation rate formula? A = starting cost, B = Ending cost.

• A(B+A) x 10

• ((B-A)/A) x 100

• B(A+B) x 1000

• None of the above

During inflationary times, people should invest in businesses with _______ capital needs.

• Low

• High

• No

What does beating inflation mean?

• Earning higher returns on investment than the economy’s inflation rate.

• Not buying goods due to inflation and only saving money.

• None of the above