A. Reduce the cost of living
B. Reduce the standard of living
C. Reduce the price of products
D. Reduce the purchasing power of a rupee
Inflation & Productivity
Inflation can be measured by all of the following except the ?
A. All of these answers are used to measure inflation.
B. consumer price index
C. Producer price index
D. GDP deflector
E. finished goods price index
Which of the following statements is correct ?
A. none of these answers
B. The nominal interest rate is the inflation rate minus the real interest rate
C. The real interest rate is the nominal interest rate minus the inflation rate
D. The nominal interest rate is the real interest rate minus the inflation rate.
According to the Phillips curve unemployment will return to the natural rate when ?
A. Nominal wages are equal to expected wages
B. Real wages are back at equilibrium level
C. Nominal wages are growing faster than inflation
D. Inflation is higher than the growth of nominal wages
If there is an increase in the price of apples which causes consumers to purchase fewer kilograms of apples and more kilograms of oranges, the CPI will suffer from ?
A. none of these answers
B. substitution bias
C. base year bias
D. bias due to unmeasured quality change
E. bias due to the introduction of new goods.
Which of the following would probably cause the CPI to rise more than the GDP deflator in the Pakistan ?
A. An increase in the price of BMWs produced in Germany and sold in the Pakistan
B. An increase in the price of Peugeots produced in the Pakistan
C. An increase in the price of helicopters purchased by the Pak Navy.
D. An increased in the Price of domestically produced armoured vehicles sold exclusively to Iran
