This quiz works best with JavaScript enabled. Home > Macroeconomics > Inflation > Inflation – Quiz 5 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Inflation Quiz 5 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Changes in technology often eliminate one type of job. This represent what type of unemployment? A) Seasonal. B) Cyclical. C) Frictional. D) Structural. Show Answer Correct Answer: D) Structural. 2. The main reason why the price of goods and services increase overtime is because of A) Deflation. B) Government controls. C) Inflation. D) All of the above. Show Answer Correct Answer: C) Inflation. 3. Which one of the following is not a possible cause of demand-pull inflation? A) An increase in government spending. B) An increase in the oil price. C) An increase in consumption spending. D) An increase in investment spending. Show Answer Correct Answer: B) An increase in the oil price. 4. Which explanation best explains the effects of inflation? A) Consumers have more products to choose from. B) Inflation erodes (take away from) the purchasing power of the dollar. C) Inflation results in lower prices. D) Demand increases because prices are higher. Show Answer Correct Answer: B) Inflation erodes (take away from) the purchasing power of the dollar. 5. Mr. Kimoon wants to sell different styles of cap for this coming summer season. He was able to buy 30 caps from the supplier. He wants to use 65% mark-up. What is the quantity in this problem/ situation? A) Cap. B) 30 caps. C) Summer season. D) 65%. Show Answer Correct Answer: B) 30 caps. 6. Inflation is measured using the CPI index. This stands for: A) Customer Principal Index. B) Consumer Private Inflation. C) Consumer Price Index. D) Customer Price Investment. Show Answer Correct Answer: C) Consumer Price Index. 7. How does nominal GDP differ from Real GDP? A) Nominal GDP is expressed in base year prices. B) Real GDP is adjusted for inflation because it is expressed in base year prices. C) Real GDP does not reflect economic growth. D) Nominal and Real GDP are the same. Show Answer Correct Answer: B) Real GDP is adjusted for inflation because it is expressed in base year prices. 8. For the country of Mordor the Nominal Gross Domestic product was $ 8000B. After comparing the inflation rate to the year prior the GDP deflator was 125. What was the real gross domestic product for Mordor? A) $ 6, 400B. B) $ 1, 000, 000B. C) $ 6, 000B. D) $ 64B. Show Answer Correct Answer: A) $ 6, 400B. 9. Select all those who may "win" or "benefit" because of inflation: A) Those retired or on fixed incomes. B) Lenders. C) Savers. D) Borrowers. Show Answer Correct Answer: D) Borrowers. 10. Fill in the blank:When inflation is high the ..... of the pound decreases. A) Cost value. B) Purchasing power. C) Importance. D) Validity. Show Answer Correct Answer: B) Purchasing power. 11. This group of people suffer when inflation occurs: A) Savers. B) People who can increase their incomes. C) Borrowers. D) Government. Show Answer Correct Answer: A) Savers. 12. What is not a possible cause of cost-push inflation? OCT/NOV 2006 01 A) A an increase in firms' profit margins. B) B an increase in the supply of money. C) C an increase in trade union power. D) D an increase in world oil prices. Show Answer Correct Answer: B) B an increase in the supply of money. 13. Who is made worse off during a period of deflation? A) Fixed income earners. B) Cash holders. C) Creditors. D) Debtors. Show Answer Correct Answer: D) Debtors. 14. Which variable from the quantity equation is replaced in income equation: A) Money. B) Velocity. C) Price. D) Transactions. Show Answer Correct Answer: D) Transactions. 15. What is the average of all prices in the economy called? A) Inflation. B) Deflation. C) Consumer Price Index. D) Price Level. Show Answer Correct Answer: D) Price Level. 16. Which of the following is NOT one of the constants the aggregate supply curve assumes? A) State of technology. B) Resource prices. C) Rules providing production incentives. D) Rate of production. Show Answer Correct Answer: D) Rate of production. 17. Which country's inflation rate is expected to exceed 1, 000, 000% this year? A) Australia. B) Venezuela. C) Indonesia. D) China. Show Answer Correct Answer: B) Venezuela. 18. Three components of Fiscal policy in the Philippines A) Revenue, debt management and expenditure policy. B) Contractionary and expansionary policy. C) Revenue policy, taxation and expenditure policy. D) Discount rate and quantitative easing. Show Answer Correct Answer: A) Revenue, debt management and expenditure policy. 19. To manage inflation, government uses macroeconomic policy including: A) Monetary Policy. B) Fiscal Policy. C) Two of them are correct. D) All of them are incorrect. Show Answer Correct Answer: C) Two of them are correct. 20. Purchasing a large quantity of scarce commodity for one's self is called ..... A) Storing. B) Boarding. C) Hoarding. D) Protecting. Show Answer Correct Answer: C) Hoarding. ← PreviousNext →Related QuizzesMacroeconomics QuizzesInflation Quiz 1Inflation Quiz 2Inflation Quiz 3Inflation Quiz 4Inflation Quiz 6Inflation Quiz 7Inflation Quiz 8Inflation Quiz 9Inflation Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books