NEW
Font size
WorksheetsGlobal Central Banks & Inflation
Total questions: 20
Worksheet time: 20mins
The current US Federal Reserve Chairman- Jerome Powell was preceded by:
Richard Clarida
Janet Yellen
Ben Bernanke
Lael Brainard
Which among the following central banks was the first to raise rates post covid:
Norges Bank
The Riksbank
Banque de France
Deutsche Bundesbank
The demand of a product is elastic, if inflation rises massively the most likely impact on the demand of the product will be:
The demand of the product will increase
The demand of the product will remain unchanged
The demand of the product will decrease
None of the above
The US Federal Reserve has been tasked with a “dual mandate” by US government to achieve monetary stability. A dual mandate means:
The central bank has two goals – achieving price stability and maximum sustainable employment
the central bank must maintain the inflation between 0%-3%
the central bank has two goals- achieving highest nominal GDP growth and price stability
The central bank has two goals - achieving highest real GDP growth and price stability
If inflation is 8% and your bank pays 6% on your savings account, your ₹100 savings today in the bank, next year will be worth:
₹100
₹106
₹108
₹98
The responsibility of conducting monetary policy in Germany lies with:
Deutsche Bundesbank
European Central Bank
Reserve Bank of Germany
Reserve Bank of Europe
Consider a company XYZ Foods Limited which operates in a highly competitive marketplace. The company is trying to increase its market share. However, due to high inflation the price of the raw material used by the company increases drastically. Ceteris paribus, the most likely impact on the profit margin of the company will be:
The profit margin of the company will decrease
The profit margin of the company will increase
The profit margin of the company will remain unchanged
None of the above
Which Central Bank is yet to increase interest rates:
Deutsche Bundesbank
Reserve Bank of Australia
Bank of Japan
Bank of Canada
Which among the following companies is expected to do well in an inflationary environment:
FMCG companies
Consumer discretionary companies
Commodity companies
None of the above
Let’s assume that you took a loan couple of years back at a fixed interest rate. As a borrower you will be happy when:
Inflation decreases
Inflation increases
Inflation remains unchanged
None of the above
All the following statements are incorrect EXCEPT:
Core inflation is headline inflation excluding food prices
Core inflation is headline inflation excluding food and energy prices
Core inflation is headline inflation excluding energy prices
Core inflation is headline inflation excluding house rent
All the following country’s central bank reduced interest rates below zero EXCEPT:
Sweden
Norway
Switzerland
Canada
The following headline appeared in Wall Street Journal article –
“Everywhere You Look, the Global Supply Chain Is a Mess - Winter storms and crammed ports in the U.S. add to disruptions of production and supplies during the pandemic”
Inflation resulting due to supply chain bottleneck is an example of:
Demand pull inflation
Cost pull inflation
J curve
Laffer Curve
If you want to protect your investments from inflation, you will invest in:
A bond with fixed coupon payments
Inflation linked bonds
zero coupon bonds
perpetual bond
To reduce inflation the government is most likely resort to:
Increase in government expenditure
Reduction in repo rate
Cuts in government spending
Large scale infra structure projects
The purchasing power of money varies:
Directly with the volume of employment
Inversely with the price level
Directly with the interest rate
Directly with the price level
The following headline appeared in Financial Times article –
“Investors need to prepare for stagflation”
A stagflation is defined as:
persistent high inflation combined with high employment and stagnant demand in a country's economy.
persistent high inflation combined with high unemployment and stagnant demand in a country's economy.
persistent high inflation combined with high unemployment and robust demand in a country's economy.
persistent low inflation combined with high unemployment and stagnant demand in a country's economy.
Which of the following acts as an inflation hedge:
Gold
Bonds
FDs
Zero coupon bonds
In US financial markets, the phrase “Greenspan Put” later modified to “Fed Put” refers to the market participants belief that:
whenever inflation will increase the Federal Reserve will increase interest rates
whenever the stock market will fall Federal Reserve will support the market by cutting interest rates
whenever unemployment will rise the Federal Reserve will increase the interest rate
whenever unemployment will rise the Federal Reserve will decrease the interest rate
Among the following central banks which central bank stock is publicly traded and listed in a stock exchange:
US Federal Reserve
Bank of Canada
Swiss National Bank
Bank of England
