Inflation And Deflation Quiz: Trivia Test!

9 Questions | Total Attempts: 1784

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Inflation And Deflation Quiz: Trivia Test! - Quiz

What do you know about inflation and deflation? Inflation is a state in the economy where the price of basic commodities goes up in a short duration of time. At the same time, deflation is characterized by a major drop in the prices of said commodities. The economy is said to be doing well when a certain balance is achieved, and it does not fully fall between either inflation or deflation. Take this quiz and learn more about these two economic conditions.


Questions and Answers
  • 1. 
    When does inflation occur?
    • A. 

      When the price of goods and services rise.

    • B. 

      When you pay your taxes

    • C. 

      When you are broke

  • 2. 
    When does inflation happen?
    • A. 

      When you don't pay attention

    • B. 

      When goods and services are high demand, creating a drop in availably.

    • C. 

      When there is low in demand

  • 3. 
    Consumers are willing to pay ______ for the items they want.
  • 4. 
    Deflation is a decrease in the general price level of goods and services.
    • A. 

      True

    • B. 

      False

  • 5. 
    ______ ____ are decided in the U.S. by the Federal Reserve.
  • 6. 
    Deflation occurs when the inflation rate falls below what percent?
    • A. 

      $50

    • B. 

      100 %

    • C. 

      0 %

  • 7. 
    Cheaper prices may seem like good news for consumers. Most economists would disagree.
    • A. 

      True

    • B. 

      False

  • 8. 
    In North America, there are two main price indexes that measure inflation:
    • A. 

      Consumer Price Index (CPI)

    • B. 

      Producer Price Indexes (PPI)

    • C. 

      CCU

    • D. 

      IIP

  • 9. 
    Falling prices are usually a sign that economic activity is RISING to an alarming degree.
    • A. 

      True

    • B. 

      False

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