Inflation Quiz

What is inflation?

• A decrease in the general price level of goods and services

• The general increase in prices of goods and services over time

• A measure of the total output of an economy

• The rate at which money is exchanged for goods

What does the inflation rate measure?

• The total amount of money in circulation

• The percentage change in the general price level over a specific period

• The number of goods produced in an economy

• The average income of consumers

What does a 3% inflation rate indicate for a given year?

• Prices have decreased by 3% compared to the previous year.

• Prices have increased by 3% compared to the previous year.

• Prices have remained the same as the previous year.

• Prices have increased by 5% compared to the previous year.

What is deflation?

• An increase in the general prices of goods and services.

• A decrease in the general prices of goods and services.

• A situation where prices remain constant.

• A rapid increase in the cost of living.

What does the Consumer Price Index (CPI) measure?

• The total number of goods produced in a year.

• The average change in prices over time for a basket of goods and services.

• The total income of households in a year.

• The number of new jobs created in a year.

What does the standard of living refer to?

• The level of comfort and material goods available to individuals or a group.

• The total number of goods produced in a country.

• The average income of a household.

• The number of new jobs created in a year.

What is a targeted inflation rate?

• The inflation rate that occurs naturally without government intervention.

• The specific inflation rate a central bank aims to achieve for economic stability.

• The rate at which prices decrease over time.

• The rate at which the cost of living increases.

What does price stability refer to?

• A situation where prices increase rapidly.

• A situation where prices decrease rapidly.

• A situation where prices remain relatively constant over time.

• A situation where prices fluctuate significantly.

What is inflation?

• The decrease in prices of goods and services over time.

• The increase in prices of goods and services over time.

• The stability of prices in the economy.

• The measurement of consumer spending patterns.

What does the inflation rate measure?

• The average change in prices over time for a basket of goods and services.

• The percentage change in the general price level over a specific period.

• The purchasing power of money in the economy.

• The standard of living for individuals in a society.