Inflation Quiz

1. The main reason why the price of goods and services increase overtime is because of

•  deflation

•  government controls

•   inflation

• All of the above

The Bureau of Labor Statistics measures inflation by using what is called

•  Consumer Purchasing Program (CPP)

• Consumer Price Index (CPI)

•   Fixed Income Index (FII)

• None of the above

 A common type of inflation is

• Deflation and Inflation

• cost-push inflation

  and

  demand-pull inflation

 When there is high inflation, the loss of buying power, especially hurts those

•  that high paying jobs

• that own homes

•  Who are on fixed incomes

• All of the above

 The group of goods and services  selected and used to measure inflation is referred to as a

•     Big Basket

• Market Basket

•   Economic Basket

• All of the above

 When there is inflation it affects

•  savers

• the cost of borrowing and people with a credit card balance

•  people on fixed income

• All of the above

 In the U.S., deflation occurs

• often

•  rarely

•  every ten years

•   never

Demand-pull inflation often occurs because a government

•   is not printing enough money

•    Is creating too few regulations

• prints too much money

• None of the above

By comparing the price change of a market basket of goods and services over time, we can determine the rate of inflation or deflation.

• True

• False

Higher prices of resources that are needed to produce goods or services pulls down all prices which causes inflation.

• True

• False