Chapter 32 Preliminary Quiz
Ensuring Price Stability

Multiple Choice Questions:

Enter your answer to each of the questions in the blank to the left of the question. Be sure to use lowercase letters only!

1. When the general level of prices is rising, we call that:
a. deflation.
b. inflation.
c. elevation.
d. none of the above.

2. When prices rise slowly and predictably, we call that:
a. galloping inflation.
b. low inflation.
c. hyperinflation.
d. deflation.

3. When inflation is in the double or triple digits, we call that:
a. galloping inflation.
b. low inflation.
c. hyperinflation.
d. deflation.

4. When inflation is at a million or trillion percent per year, we call that:
a. galloping inflation.
b. low inflation.
c. hyperinflation.
d. deflation.

5. In general, unanticipated inflation will be good for:
a. debtors.
b. creditors.
c. lenders.
d. none of the above.

6. Hyperinflations are associated with ______ growth, low inflation is associated with _______ growth, and deflations are associated with _______ growth.
a. rapid; rapid; negative
b. negative; rapid; rapid
c. negative; rapid; slow
d. slow; rapid; negative.

7. Demand-pull inflation occurs when:
a. imports exceed exports.
b. aggregate demand rises more rapidly than the economy's productive potential.
c. both a and b.
d. neither a nor b.

8. Inflation resulting from rising costs during periods of high unemployment and slack resource utilization is called:
a. demand-pull inflation.
b. supply-pull inflation.
c. cost-pull inflation.
d. inertial inflation.

9. _______ occurs when the AS and AD curves are moving steadily upward at the same rate.
a. demand-pull inflation.
b. supply-pull inflation.
c. cost-pull inflation.
d. inertial inflation.

10. The short-run _______ shows the inverse relationship between inflation and unemployment.
a. aggregate supply curve
b. aggregate demand curve
c. Phillips Curve
d. NAIRU

11. The unemployment rate consistent with a constant inflation rate is called:
a. NAIRU
b. hyperinflation
c. Phillips rate
d. none of the above.

12. The long-run Phillips curve:
a. is horizontal at the NAIRU.
b. is vertical at the NAIRU.
c. is fixed at the origin.
d. does not exist.

Chapter 32 Preliminary Quiz Ensuring Price Stability

Multiple Choice Questions:

1. When the general level of prices is rising, we call that: a. deflation. b. inflation. c. elevation. d. none of the above.

2. When prices rise slowly and predictably, we call that: a. galloping inflation. b. low inflation. c. hyperinflation. d. deflation.

3. When inflation is in the double or triple digits, we call that: a. galloping inflation. b. low inflation. c. hyperinflation. d. deflation.

4. When inflation is at a million or trillion percent per year, we call that: a. galloping inflation. b. low inflation. c. hyperinflation. d. deflation.

5. In general, unanticipated inflation will be good for: a. debtors. b. creditors. c. lenders. d. none of the above.

6. Hyperinflations are associated with ______ growth, low inflation is associated with _______ growth, and deflations are associated with _______ growth. a. rapid; rapid; negative b. negative; rapid; rapid c. negative; rapid; slow d. slow; rapid; negative.

7. Demand-pull inflation occurs when: a. imports exceed exports. b. aggregate demand rises more rapidly than the economy's productive potential. c. both a and b. d. neither a nor b.

8. Inflation resulting from rising costs during periods of high unemployment and slack resource utilization is called: a. demand-pull inflation. b. supply-pull inflation. c. cost-pull inflation. d. inertial inflation.

9. _______ occurs when the AS and AD curves are moving steadily upward at the same rate. a. demand-pull inflation. b. supply-pull inflation. c. cost-pull inflation. d. inertial inflation.

10. The short-run _______ shows the inverse relationship between inflation and unemployment. a. aggregate supply curve b. aggregate demand curve c. Phillips Curve d. NAIRU

11. The unemployment rate consistent with a constant inflation rate is called: a. NAIRU b. hyperinflation c. Phillips rate d. none of the above.

12. The long-run Phillips curve: a. is horizontal at the NAIRU. b. is vertical at the NAIRU. c. is fixed at the origin. d. does not exist.

Chapter 32 Preliminary Quiz
Ensuring Price Stability

1. When the general level of prices is rising, we call that:
a. deflation.
b. inflation.
c. elevation.
d. none of the above.

2. When prices rise slowly and predictably, we call that:
a. galloping inflation.
b. low inflation.
c. hyperinflation.
d. deflation.

3. When inflation is in the double or triple digits, we call that:
a. galloping inflation.
b. low inflation.
c. hyperinflation.
d. deflation.

4. When inflation is at a million or trillion percent per year, we call that:
a. galloping inflation.
b. low inflation.
c. hyperinflation.
d. deflation.

5. In general, unanticipated inflation will be good for:
a. debtors.
b. creditors.
c. lenders.
d. none of the above.

6. Hyperinflations are associated with __ growth, low inflation is associated with _ growth, and deflations are associated with _____ growth.
a. rapid; rapid; negative
b. negative; rapid; rapid
c. negative; rapid; slow
d. slow; rapid; negative.

7. Demand-pull inflation occurs when:
a. imports exceed exports.
b. aggregate demand rises more rapidly than the economy's productive potential.
c. both a and b.
d. neither a nor b.

8. Inflation resulting from rising costs during periods of high unemployment and slack resource utilization is called:
a. demand-pull inflation.
b. supply-pull inflation.
c. cost-pull inflation.
d. inertial inflation.

9. _______ occurs when the AS and AD curves are moving steadily upward at the same rate.
a. demand-pull inflation.
b. supply-pull inflation.
c. cost-pull inflation.
d. inertial inflation.

10. The short-run _______ shows the inverse relationship between inflation and unemployment.
a. aggregate supply curve
b. aggregate demand curve
c. Phillips Curve
d. NAIRU

11. The unemployment rate consistent with a constant inflation rate is called:
a. NAIRU
b. hyperinflation
c. Phillips rate
d. none of the above.

12. The long-run Phillips curve:
a. is horizontal at the NAIRU.
b. is vertical at the NAIRU.
c. is fixed at the origin.
d. does not exist.