What is inflation?
a) A decrease in the general price level of goods and services
b) An increase in the general price level of goods and services
c) A decrease in the value of currency but stable prices
d) A temporary reduction in the economy’s growth rate
Which economic indicator is used to measure inflation?
a) Gross Domestic Product (GDP)
b) Consumer Price Index (CPI)
c) Unemployment Rate
d) Balance of Trade
What is the primary cause of demand-pull inflation?
a) Increased consumer demand for goods and services
b) Rising production costs
c) Increase in unemployment
d) Government budget surplus
Which of the following is an effect of high inflation?
a) Increased purchasing power of money
b) Lower interest rates
c) Decreased value of money over time
d) Higher unemployment rates only
Which organization monitors global inflation trends?
a) World Health Organization (WHO)
b) World Bank
c) International Monetary Fund (IMF)
d) United Nations (UN)
What is cost-push inflation?
a) Inflation caused by higher demand
b) Inflation due to increased production costs
c) Inflation due to economic recession
d) Inflation resulting from currency depreciation
Which sector is most affected by hyperinflation?
a) Technology
b) Agriculture
c) Financial and banking
d) All sectors of the economy
What is the main tool used by central banks to control inflation?
a) Increasing government spending
b) Adjusting interest rates
c) Raising taxes
d) Lowering wages
Which economic policy can help reduce inflation?
a) Expansionary monetary policy
b) Increasing the money supply
c) Contractionary monetary policy
d) Increasing government subsidies
What happens when inflation is too low?
a) Prices rise sharply
b) Economic growth accelerates
c) The risk of deflation increases
d) Unemployment rates decrease significantly
Which of the following is a global economic trend?
a) Decreasing globalization
b) Increasing digital transformation
c) Declining energy demand
d) Eliminating trade policies
Which of the following is a cause of global inflation?
a) Decrease in government spending
b) Increase in global supply chain disruptions
c) Reduction in interest rates
d) Decrease in consumer demand
What is stagflation?
a) Economic growth with low inflation
b) High inflation combined with low economic growth and high unemployment
c) High inflation and rapid economic growth
d) Deflation and increased GDP
Which economic trend is influencing global markets?
a) Decreased investment in green energy
b) Increasing automation and artificial intelligence
c) Rising oil prices leading to economic stability
d) A decline in global trade agreements
How does inflation affect savings?
a) Increases the real value of money saved
b) Reduces the purchasing power of money saved
c) Makes saving more profitable
d) Has no impact on savings
What is the impact of inflation on wages?
a) Wages always increase at the same rate as inflation
b) Inflation can erode the real value of wages
c) Wages remain unchanged during inflation
d) Inflation leads to lower employment costs
Which global economic factor contributes to inflation?
a) Decreasing fuel prices
b) Supply chain disruptions
c) Higher agricultural productivity
d) Reduced government spending
Which economic policy is used to manage inflation?
a) Reducing taxes
b) Increasing public expenditure
c) Raising interest rates
d) Printing more money
What is the relationship between inflation and interest rates?
a) When inflation rises, interest rates usually increase
b) When inflation rises, interest rates always decrease
c) Inflation and interest rates are not related
d) Interest rates remain constant regardless of inflation
How do governments typically respond to high inflation?
a) Reduce taxes on luxury goods
b) Lower interest rates
c) Implement tighter monetary policies
d) Increase social spending
Which economic theory explains inflation due to excessive money supply?
a) Keynesian Theory
b) Monetarist Theory
c) Demand-Supply Theory
d) Classical Growth Model
What is a consequence of prolonged inflation?
a) Increased purchasing power
b) Higher costs of living
c) Strengthening of the national currency
d) Decrease in production costs
Which global economic trend affects inflation rates?
a) Advancements in automation
b) Rising protectionism in trade policies
c) Growth of the gig economy
d) Expansion of small businesses
What is hyperinflation?
a) A normal rate of inflation in a developing economy
b) Inflation exceeding 50% per month
c) A temporary increase in food prices
d) A reduction in inflation rates over time
How does inflation affect international trade?
a) It strengthens the value of the currency
b) It makes exports more expensive and imports cheaper
c) It has no impact on trade
d) It reduces the cost of production
