English for economics 4

What is a common misconception about doubling your income?

• It guarantees increased purchasing power.
• It has no effect on purchasing power.
• It is only beneficial if others' incomes do not change.
• It is always beneficial.

If everyone's income doubles, what happens to overall purchasing power?

• It varies based on individual spending habits.
• It remains the same.
• It increases significantly for everyone.
• It decreases for everyone.

If your income doubles while everyone else's triples, what is the likely outcome?

• You will be wealthier than before.
• You will maintain your purchasing power.
• You will become poorer.
• You will be unaffected.

How does inflation create disparities in real income among individuals?

• It guarantees equal income for all.
• It has no effect on income distribution.
• It can lead to some individuals earning more than others in real terms.
• It affects everyone equally.

How does inflation affect the purchasing power of money over time?

• It stabilizes purchasing power.
• It decreases purchasing power.
• It has no effect on purchasing power.
• It increases purchasing power.

What does the term 'real income' refer to?

• Income in nominal terms.
• Income before taxes.
• Income adjusted for inflation.
• Income that includes bonuses.

What must happen to your income to maintain purchasing power in an inflationary economy?

• It must decrease.
• It must increase more than the inflation rate.
• It must increase at least as much as the inflation rate.
• It can remain the same.

What happens to purchasing power if your income increases but inflation rises faster?

• Your purchasing power increases.
• Your purchasing power remains the same.
• Your purchasing power decreases.
• Your purchasing power is unaffected.

What historical example illustrates the decrease in purchasing power over time?

• A dollar today buys significantly less food than it did a hundred years ago.
• A dollar today buys more than it did a hundred years ago.
• Prices of goods have decreased over the last century.
• Inflation has remained constant over the last century.

Which of the following statements about inflation's impact on consumer goods is true?

• All goods are affected equally by inflation.
• Inflation affects different goods differently.
• Inflation has no impact on consumer goods.
• Consumer goods become more valuable during inflation.