Inflation And Deflation Quiz 25 (6 MCQs)

Quiz Instructions

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1. What tool measures the change in slope of a volcano?

Correct Answer: C) Tilt meter.

2. Which of the following shows the difference between deflation and disinflation

Correct Answer: D) Disinflation is when the inflation rate is positive but decreasing whereas deflation is when the inflation rate is negative.

3. The quantity theory of money suggests that an increase in the money supply increases real output proportionately.

Correct Answer: B) False.

4. Debtors are winner because

Correct Answer: B) Their debts carry fixed rates. They pay their loans back in less valuable currency.

5. What is the average price of goods and services in the economy called?

Correct Answer: B) Price level.

6. State if the following statements is true?

Correct Answer: C) The inflation rate is calculated from a set of CPI figures.