Inflation Quiz

What is the main reason for the increase in the price of a Big Mac from 45 cents to $3.99?

• Competition

• Taxation

• Inflation

• Supply and demand

How are changes in prices monitored by statistical bureaus?

• Using a crystal ball

• Entering data into a calculator

• Ignoring the changes

• Guessing randomly

What does the rate of inflation help the government in setting?

• Stock prices

• Interest rates

• Tax deductions

• Welfare payments

In a stable economy, prices usually go up by what percentage annually?

• 1-2%

• 5-10%

• 15-20%

• 0-1%

In what year did prices in Zimbabwe double every 24 hours?

• 2010

• 2015

• 2000

• 2008

What happened in Zimbabwe due to the rapid inflation in 2008?

• Prices decreased rapidly

• The economy collapsed

• The country ran out of paper to print banknotes

• Everyone became millionaires

What is one of the consequences of an inflationary spiral?

• Stability in the economy

• Increase in currency value

• Decrease in government spending

• Devaluation of currency

Why is a small amount of inflation usually seen as a good thing?

• It leads to deflation

• It causes unemployment

• It keeps the economy growing

• It helps reduce debt

How does inflation affect savers?

• It decreases the value of their savings

• It has no impact

• It increases their savings

• It doubles their savings

What happens to the purchasing power of money over time due to inflation?

• It remains the same

• It fluctuates randomly

• It increases

• It decreases