Title: QUIZ: The Inflation Rate Is Falling, but Prices Are Not -- Page One Economics®
Course: Recommended Resources for AP Macro from FRE > Section: Unit 2: Economic Indicators and the Business Cycle

Q: According to the graph, the annual U.S. inflation rate in 2009 was approximately
- -2%
- 0%
- 2%
- Unknown
A: 0%

Q: When the inflation rate is 12% in year 1 and 15% the following year, the price level is
- increasing.
- decreasing.
- staying the same.
- indeterminate.
A: increasing.

Q: When the inflation rate is 12% in year 1 and 9% the following year, the price level is
- increasing.
- decreasing.
- staying the same.
- unknown.
A: increasing.

Q: When the inflation rate is 12% in year 1 and 12% the following year, the price level is
- increasing.
- decreasing.
- staying the same.
- unknown.
A: increasing.

Q: The price level in year 1, as measured by the CPI, is 100. The price level in the following year is 95. This is an example of
- inflation.
- hyperinflation.
- disinflation.
- deflation.
A: deflation.

Q: The price level in year 1, as measured by the CPI, is 100. The price level in the following year is 105. This is an example of
- inflation.
- hyperinflation.
- disinflation.
- deflation.
A: inflation.

Q: The inflation rate is calculated using
- the deflation rate.
- the consumer price index.
- the labor force participation rate.
- the consumer sentiment index.
A: the consumer price index.

Q: The inflation rate falls from 12% to 9%. This is an example of
- stagflation.
- hyperinflation.
- disinflation.
- deflation.
A: disinflation.

Q: If the inflation rate is 3%, it means that all prices are increasing by 3%.
- True
- False
A: False