Question 1
What is meant by deflation?
A.
Sustained fall in the general price level. B.
Inflation rate falling but still positive. C.
Time/resources spent reducing money holdings. D.
2% CPI with ±1% tolerance band.
Question 2
What is meant by inflation?
A.
AD rises faster than SRAS can respond. B.
Sustained rise in the general price level. C.
Short-run inverse relationship between inflation and unemployment. D.
2% CPI with ±1% tolerance band.
Question 3
What is meant by demand-pull inflation?
A.
Inflation rate falling but still positive. B.
Time/resources spent reducing money holdings. C.
AD rises faster than SRAS can respond. D.
Sustained rise in the general price level.
Question 4
Demand-pull inflation occurs when:
A.
SRAS shifts right B.
Exports fall only C.
Taxes are cut with no effect D.
AD increases faster than supply can respond
Question 5
What is meant by menu costs?
A.
Short-run inverse relationship between inflation and unemployment. B.
Inflation rate falling but still positive. C.
Sustained rise in the general price level. D.
Costs of changing prices during inflation.
Question 6
CPI measures:
A.
Only house prices B.
Only wages C.
Only import prices D.
Changes in a basket of consumer prices
Question 7
Cost-push inflation is shown by:
A.
LRAS shifting right B.
AD shifting right only C.
PPF shifting in D.
SRAS shifting left
Question 8
What is meant by cpi?
A.
Rising costs shift SRAS left. B.
Costs of changing prices during inflation. C.
Time/resources spent reducing money holdings. D.
Main UK inflation measure (ONS shopping basket).
Question 9
The Phillips curve suggests:
A.
MPC equals zero B.
Lower unemployment may mean higher inflation in the SR C.
GDP always equals potential D.
BoP must balance monthly
Question 10
What is meant by phillips curve?
A.
Main UK inflation measure (ONS shopping basket). B.
Sustained rise in the general price level. C.
Short-run inverse relationship between inflation and unemployment. D.
Sustained fall in the general price level.
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