This quiz works best with JavaScript enabled. Home > Macroeconomics > Inflation > Inflation – Quiz 7 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Inflation Quiz 7 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. If the old CPI of a product is 200 and the new CPI is 100, what is the percent change? A) 50. B) 25. C) 75. D) 100. Show Answer Correct Answer: D) 100. 2. This guarantees survival, adequate food, clothing, shelter, health care, education, and sanitation. A) Right to Safety. B) Right to Basic Needs. C) Right to Information. D) Right to Choose. Show Answer Correct Answer: B) Right to Basic Needs. 3. Rick owns 70 shares of DuPere stock for which he paid a total of $ 4472. He sold the stock for $ 84 per share and paid a sales commission of $ 50. What was his profit or loss on the investment? A) $ 1358 profit. B) $ 1358 loss. C) $ 1308 profit. D) None of above. Show Answer Correct Answer: A) $ 1358 profit. 4. The economy is in deficit when ..... A) We have more than we need to spend. B) We need to spend more than we have. C) None of the above. D) None of above. Show Answer Correct Answer: B) We need to spend more than we have. 5. What causes demand pull inflation? A) Rise in price due to a decrease in supply. B) A rise in price level due to an increase in consumption. C) A rise in price due to an increase in the cost of production. D) A decrease in price due to a decrease in supply. Show Answer Correct Answer: B) A rise in price level due to an increase in consumption. 6. What is GDP an economic indicator for? A) Economic growth. B) Prices. C) Environmental growth. D) None of above. Show Answer Correct Answer: A) Economic growth. 7. ..... occurs in the economy when unemployment and inflation are both high.Disinflation A) Hyperinflation. B) Deflation. C) Stagflation. D) None of above. Show Answer Correct Answer: C) Stagflation. 8. You can represent cost-push inflation in a diagram through ..... A) An inward shift of SRAS. B) An outward shift of SRAS. C) An inward shift of AD. D) An outward shift of AD. Show Answer Correct Answer: A) An inward shift of SRAS. 9. If the nominal interest rate is 6 per cent and the inflation rate is 3 per cent, the real interest rate is A) 3 percent. B) 6 percent. C) 9 percent. D) 18 percent. Show Answer Correct Answer: A) 3 percent. 10. Inflation is: A) A rapid increase in the quantity of money. B) A sustained increase in prices in general. C) Too much money chasing too few goods. D) A once-off increase in prices in general. Show Answer Correct Answer: B) A sustained increase in prices in general. 11. A Car is purchased for $ 24000, it's value will depreciate by 15% per year. What is the value of this car after 7 years indexed for inflation given that the average inflation rate over this period is 2.1%? [1 pt] A) $ 7693.85. B) $ 6652.17. C) $ 8898.65. D) None of above. Show Answer Correct Answer: C) $ 8898.65. 12. ..... refers to a decrease in price level. A) Hyperinflation. B) Disinflaation. C) Deflation. D) Stagflation. Show Answer Correct Answer: C) Deflation. 13. Inflation is usually higher during what part of the Business Cycle? A) Upswing. B) Recession. C) Trough. D) Boom. Show Answer Correct Answer: D) Boom. 14. The Consumer Price Index (CPI) is best used to determine A) The Dow Jones Index. B) The rate of inflation. C) The unemployment rate. D) Currency exchange rates. Show Answer Correct Answer: B) The rate of inflation. 15. If a change in income appears permanent such as being promoted to a secure and high paying job, ..... A) Then people are likely to consume less. B) Then people are likely to save more. C) Then people are likely to consume more. D) Then people are likely to save less. Show Answer Correct Answer: C) Then people are likely to consume more. 16. An increase in government spending will most likely lead to inflation when A) It is spent on education. B) The economy is near full capacity. C) There is a large amount of spare capacity. D) It is spent on imported capital goods. Show Answer Correct Answer: B) The economy is near full capacity. 17. A very rapid increase in the level of prices over time A) Inflation. B) Inflation rate. C) Deflation. D) Hyperinflation. Show Answer Correct Answer: D) Hyperinflation. 18. Inflation causes the purchasing power of the dollar to ..... A) Increase. B) Decrease. C) Stay the same. D) No change. Show Answer Correct Answer: B) Decrease. 19. If an expense can be eliminated from your budget to save money, it is considered a ..... A) Income. B) Want. C) Need. D) Savings. Show Answer Correct Answer: B) Want. 20. Which of the following terms is also known as total output? A) Price index. B) Price level. C) Aggregate demand. D) Aggregate supply. Show Answer Correct Answer: D) Aggregate supply. ← PreviousNext →Related QuizzesMacroeconomics QuizzesInflation Quiz 1Inflation Quiz 2Inflation Quiz 3Inflation Quiz 4Inflation Quiz 5Inflation Quiz 6Inflation Quiz 8Inflation Quiz 9Inflation Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books