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Question
When the general price level increases by 10% to 20% per annum, then it will be called:
Solution
- When the general price level increases by 10% to 20% per annum, it is called running inflation.
- Running inflation is defined as a relatively quick price increase, which can impact purchasing power and economic stability but is less severe than hyperinflation.
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RELATED QUESTIONS
'A state of running or hyperinflation in any economy is very harmful for production'. Justify the statement with two reasons.
What is walking inflation?
What is the meaning of creeping inflation?
Study the relationship in the first pair of words and complete the second pair.
- Creeping inflation: The rate of inflation is 1% to 2% per annum.
- Running inflation: The rate of inflation is ______ per annum.
______ inflation occurs when prices rise at a very fast rate from more than 20% to 100 percent or more per annum.
______ is beneficial for growth.
When the general price level increases by 10% to 20% per annum, then it will be called:
Choose the correct answers to the questions from the given options.
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Reason (R): Higher fuel prices in the international market due to war.
Read the following statement carefully and choose the correct alternative given below:
Assertion (A): Value of money falls during inflation.
Reason (R): Government employees are compensated for inflation by raising their dearness allowance.
A moderate dose of inflation to necessary for the development of an economy. Briefly explain.
