Chapter 9 Quiz example #61462

_____________ implies that pressure for price increases reaches across _______________ markets, not just one. a. inflation; all b. deflation; most c. inflation; most d. deflation; all

The effects of inflation are seen in : a. goods and services only b. wages and income levels only c. services and wages only d. goods, services, wages and income levels

If the price index moves from 107 to 110, the rate of inflation is: a. 3% b. 30% c. 28% d. 2.8%

The most commonly cited measure of inflation in the United States is: a. the Consumer Price Index (CPI) b. the Deflationary Price Index (DPI) c. the Cumulative Price Index (CPI) d. the Inflationary Price Index (IPI)

Two factors that complicate the calculation of the inflation rate are: a. substitution and quality/new product bias b. preferential bias c. complimentary product bias d. consumer behavior bias

In the early 1990's extremely high inflation rates of 2500% were common in Russia. During that time, we can say that as a result of those inflation rates, Russia was experiencing ______________________. a. perpetual inflation b. ultra inflation c. hypo inflation d. hyperinflation

With regard to the economy, the term negative inflation is synonymous with which of the following? a. recession b. depression c. deflation d. hyperinflation

What distinguishes the real value of a statistic from the nominal value of a statistic? a. timing of announcement b. adjusting for inflation c. adjusting for GDP deflator d. real interest rate

Nancy's union has negotiated a three-year wage contract that provides for a 2.4% increase indexed to inflation. The rates of inflation are forecast to be 1.62%, 1.93% and 2.21% respectively. How will Nancy's wage increase be expressed in the new contract? a. COLA plus 1.6% b. COLA plus 1.9% c. COLA plus 2.4% d. COLA plus 2.2%

ABC Bank targets a real interest rate of 4% on their loans. The anticipated future inflation rate is 2%. What is the nominal interest rate they will charge a borrower? a. 2% b. 4% c. 6% d. 8%