Friday, June 5, 2015

Day 47 - Questions


Day 47 - Inflation terms

( Inflation, Deflation, Reflation, Disinflation, Hyperinflation, Stagflation )


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1.  Which of the following refers to Reflation?
a.  decreasing inflation rate by government
b.  increasing inflation rate by government
c.  balancing inflation rate by government
d.  none of the above

2.  Reflation by government may be necessary in which of the following situation?
a.  highly inflated economy
b.  highly deflated economy
c.  both (a) and (b)
d.  none of the above

3.  If the government tries to decrease the Inflation rate of the economy, then it will be known as -
a.  Reflation
b.  Deflation
c.  Disinflation
d.  Stagflation

4.  Disinflation by government may be necessary in which of the following situation?
a.  highly inflated economy
b.  highly deflated economy
c.  both (a) and (b)
d.  none of the above

5.  Which of the following is/are correct opposite of each other?
i.  Inflation - Disinflation
ii.  Inflation - Deflation
iii.  Inflation - Reflation
iv.  Reflation - Disinflation
v.  Deflation - Disinflation

a.  Only i, iii and v
b.  Only ii and iv
c.  All except v
d.  Only ii

6.  Hyperinflation refers to an extreme situation of Inflation in an economy, when the country experiences very high price level of goods and the real value of money is very low. 

Which of the following could be the best option in this situation?
a.  Hold more domestic currency
b.  Hold more foreign currency 
c.  Both (a) and (b)
d.  None of the above

7.  Stagflation is an extreme situation of Inflation in an economy, when the country is in highly inflated stated, in combine with -
a.  high employment
b.  high unemployment
c.  high forex reserve
d.  low forex reserve




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