Answers VT-GA-EOC-Personal Finance Economics A ULHSTechnology and Economics

Money Answers

0 verified answers1 views

The inflationary spiral explains the causes and effects of high inflation. The spiral usually begins with an increase in demand. What is the direct effect of this increase?

Producers raise prices to continue to make a profit.

The government prints more money, lowering the value of money.

Workers negotiate with employers to receive more money.

Consumers need higher wages to keep up with rising prices.

Free Preview

What are the signs of high inflation? Check all that apply.Production begins to fall.Production begins to rise.Interest rates decrease.Interest rates increase.Purchasing power falls.Fewer fixed rate bank loans.

Production begins to fall.

Production begins to rise.

Interest rates decrease.

Interest rates increase.

Purchasing power falls.

Fewer fixed rate bank loans.

Which is an effect of stagflation?

Trade with other economies increases.

The value of a country’s currency drops.

Prices for goods fall sharply and suddenly.

The GDP rises along with production levels.

The graph shows changes in the US economy between 1971 and 2001.According to the graph, 1971 to 1976 was a period of stagflation due to

rising unemployment and inflation.

falling unemployment and inflation.

rising unemployment and falling inflation.

falling unemployment and rising inflation.

What is one consequence of stagflation?

The economy drastically slows down as money loses its buying power.

Producers cannot keep up with consumer interest and raise their prices.

There are not enough workers to meet the rising level of production.

Demand is too high and people spend more money than they should.

Typically, low inflation is a sign of

a healthy economy because it results from a steady rise in demand.

a healthy economy because it results from a steady rise in supply.

a struggling economy because it results from a steady fall in demand.

a struggling economy because it results from a steady fall in supply.

losegain

lose

gain

Which scenario is an example of demand-pull inflation?

Consumers have more money to buy cars, and the prices of cars and car accessories rise as a result.

An increase in workers’ wages raises the production cost of cars, and car prices rise as a result.

The demand for cars falls as consumers have less disposable income, and car prices fall as a result.

A government bailout helps car manufacturers lower their costs, and car prices fall as a result.

Which scenario is an example of cost-push inflation?

Consumers have more money to buy cars, and the prices of cars and car parts rise as a result.

An increase in workers’ wages raises the production cost of cars, and car prices rise as a result.

The demand for cars falls as consumers have less disposable income, and car prices fall as a result.

A government bailout helps car manufacturers lower their costs, and car prices fall as a result.

How does demand-pull inflation differ from cost-push inflation?

Demand-pull inflation is driven by consumers, while cost-push inflation is driven by producers.

Demand-pull inflation is driven by producers, while cost-push inflation is driven by consumers.

Demand-pull inflation is driven by the private sector, while cost-push inflation is driven by the government.

Demand-pull inflation is driven by the government, while cost-push inflation is driven by the private sector.

Did you find these answers helpful?

Money Answers

More from this Course

TRY EDGENUITY HACKS