This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Inflation And Deflation > Inflation And Deflation – Quiz 5 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Inflation And Deflation Quiz 5 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. National Income is always more than the domestic gross product A) True. B) False. Show Answer Correct Answer: B) False. 2. Which statement is true about the Supply shock or Cost-push Inflation? A) One of the illustrations is climate change. B) Caused from increase the cost of production. C) Caused from rising energy and commodity prices. D) All is true. Show Answer Correct Answer: D) All is true. 3. Gross Domestic product plus ..... is gross national product A) NPIA. B) Taxes and Subsidy. C) Depreciation. D) Profits. Show Answer Correct Answer: A) NPIA. 4. Nominal wage adjusted for inflation is described as A) Living wage. B) RPI. C) Real wage. D) Constant prices. Show Answer Correct Answer: C) Real wage. 5. If you currently pay $ 130 per week on food for yourself, how much would you expect to pay 35 years from now if inflation stays at 5%? A) $ 130. B) $ 650. C) $ 717.60. D) $ 4550. Show Answer Correct Answer: C) $ 717.60. 6. Nominal wage adjusted for inflation A) Living wage. B) RPI. C) Real wage. D) Constant prices. Show Answer Correct Answer: C) Real wage. 7. What is the likely impact of inflation on the current account on the balance of payments? A) Improvement. B) Deterioration. C) Stability. D) No impact. Show Answer Correct Answer: B) Deterioration. 8. To reduce inflation in the long term, appropriate policies include A) Policies to increase aggregate demand. B) Policies to reduce aggregate supply. C) Fiscal policies that boost spending. D) Supply side policies. Show Answer Correct Answer: D) Supply side policies. 9. Jose got a 6% raise in his salary, but the rate of inflation is 2%. What is Jose's REAL rate of salary increase? (a) A) A 4%. B) 5%. C) 2%. D) 3%. Show Answer Correct Answer: A) A 4%. 10. In a volcano, magma collects in a packet called ..... A) Magma flow. B) Magma chamber. C) Magma pipe. D) Hot spot. Show Answer Correct Answer: B) Magma chamber. 11. What is an idea A) An action. B) Having a thought about doing something. C) A plan. D) None of above. Show Answer Correct Answer: B) Having a thought about doing something. 12. 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. 13. Which of the following is most likely to cause cost-push inflation? A) Decrease in the cost of firms. B) Increase in aggregate demand. C) Decrease in spending on imports. D) Increase in wages. Show Answer Correct Answer: D) Increase in wages. 14. Demand-pull inflation can be described as too many ..... chasing too few ..... A) Rupees, Goods. B) Jobs, Workers. C) Consumers, Producers. D) None of above. Show Answer Correct Answer: A) Rupees, Goods. 15. When prices rise rapidly at a rate of 10 to 20 % per annum, it is called Running Inflation. A) True. B) False. Show Answer Correct Answer: A) True. 16. Which of the following is increased due to inflation? A) Purchasing power. B) Price of imports. C) Cost of living. D) Competitiveness of exports. Show Answer Correct Answer: C) Cost of living. 17. What tool times how long it takes for a laser to travel from the instrument, to a mirror on the volcano and back? A) Global Positioning System (GPS). B) Electronic Distance Meter (EDM). C) Tilt meter. D) None of above. Show Answer Correct Answer: B) Electronic Distance Meter (EDM). 18. What is marketing A) Sales. B) Drawing a picture. C) Promoting and selling your products or services through advertising. D) None of above. Show Answer Correct Answer: C) Promoting and selling your products or services through advertising. 19. An increase and decrease in the overall level of prices is respectively called as: A) Inflation-Deflation. B) Hyperinflation-Deflation. C) Inflation-Money velocity. D) Deflation-Inflation. Show Answer Correct Answer: A) Inflation-Deflation. 20. ..... Higher prices of resources which are needed to produce goods or services pulls down all prices, thus, causing inflation. A) True. B) False. Show Answer Correct Answer: B) False. ← PreviousNext →Related QuizzesMacroeconomics QuizzesEconomics QuizzesInflation And Deflation Quiz 1Inflation And Deflation Quiz 2Inflation And Deflation Quiz 3Inflation And Deflation Quiz 4Inflation And Deflation Quiz 6Inflation And Deflation Quiz 7Inflation And Deflation Quiz 8Inflation And Deflation Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books