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14 Cards in this Set
- Front
- Back
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It is a rise in the general level of prices |
INFLATION |
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True or False Inflation increases the purchasing power of money. |
FALSE Inflation reduces the 'purchasing power' of money. |
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Measurement of inflation |
CONSUMER PRICE INDEX |
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It is a measure of the overall cost of the goods and services bought by a typical consumer |
CONSUMER PRICE INDEX (CPI) |
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Consumer goods and services that are presumably purchased by a typical urban consumer |
MARKET BASKET |
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Different Types of Inflation |
• Demand Pull Inflation • Cost-push inflation • Core inflation • Hyperinflation • Wage inflation • Imported Inflation |
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Rising Demand in economy |
DEMAND-PULL INFLATION |
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Increase in cost ( Example: Rising in oil prices) |
COST-PUSH INFLATION |
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Inflation rate excluding temporary factors |
CORE INFLATION |
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Inflation caused by rising real wage |
WAGE-INFLATION |
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Inflation of over 1,000% a year. |
HYPERINFLATION |
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Inflation caused by rising price if imports (Example: due to devaluation) |
IMPORTED INFLATION |
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A measure of the cost of a basket of goods and services bought by firms |
PRODUCER PRICE INDEX |
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True or False
The goal of consumer price index is to measure changes in the cost of living |
TRUE |
