Mace Chap03_Inflation

Which of the following shows annual inflation rate of greater than 10% ?

• Creeping

• Walking

• Galloping

• Hyperinflation

All of the following are types of inflation except:

• Demand

  pull

  Inflation

• Cost

  push

  Inflation

• Cost

  pull

  Inflation

• No answer

Increase in consumer wealth will likely lead to

• Demand

  pull

  Inflation

• Demand

  push

  Inflation

• Cost

  push

  Inflation

• Cost

  pull

  Inflation

What will happen in cost-push inflation?

• Nothing happens

• Fall in real GDP

• Rise in real GDP

• Fall in price

Who will benefit from inflation?

• Contract worker with fixed salary

• Retirees

• Money lender with zero interest

• Money borrower with zero interest

Which of the following is true about CPI?

• Input price index

• It measures changes in the average price of

  goods and services that firms would purchase

• The goods and services consumed are grouped into different baskets of good

  and these baskets are always changing

• No answer