Chapter 3: Inflation & the Value of Money (Section 3-1)

Question 1

An increase in the general level of prices for goods and services

Answer 1

Inflation

Question 2

When we buy things without thinking about it we are supporting our

Answer 2

Habits

Question 3

Our _________ reflect of how people think about their future and about the product being sold

Answer 3

Attitudes

Question 4

CPI stands for

Answer 4

Consumer Price Index

Question 5

The measurement tool used to measure inflation

Answer 5

CPI

Question 6

COLA stands for

Answer 6

Cost of Living Adjustments

Question 7

Regular pay increases from employers to keep pace with inflation

Answer 7

COLA

Question 8

Rising prices with the rate of increase slowing down

Answer 8

Disinflation

Question 9

High prices followed by lower prices and then high prices again

Answer 9

Relfation

Question 10

Rapidly rising prices that are out of control

Answer 10

Hyperinflation

Question 11

A decrease in the general level of prices for goods and services

Answer 11

Deflation

Question 12

Higher prices as a result of consumers wanting to buy more goods and services than producers supply

Answer 12

Demand-Pull Inflation

Question 13

Rising prices as a result of rising production costs

Answer 13

Cost-Push Inflation

Question 14

A measure of the efficiency with which goods and services are made (comparison of total output to total inputs)

Answer 14

Productivity

Question 15

Rising prices due to scarce resources or increased difficulty in obtaining resources

Answer 15

Real-Cost Inflation

Question 16

When demand decreases and result in lower profits which makes producers lay off workers

Answer 16

Inflation/Employment Tradeoff

Question 17

Money you have left to spend after taxes and other deductions have been paid

Answer 17

Disposable income

Question 18

A concept that says a dollar you receive in the future will be worth less than a dollar you receive today

Answer 18

Time value of money