ECONOMICS
INFLATION
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Creeping
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Running
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Trotting
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Hyper
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Detailed explanation-1: -Trotting Inflation: When prices rise moderately and the annual inflation rate is in single digit (3% – 10%), it is called walking or trotting inflation. Inflation at this rate is a warning signal for the government to control it before it turns into running inflation.
Detailed explanation-2: -It is a situation where inflation in an economy increases gradually. It is one of the mildest types of inflation and is required to maintain a stable economy. Walking inflation. Also known as trotting inflation, it is a situation when the prices rise up to 10%.
Detailed explanation-3: -Important Terms related to Inflation Open inflation: A situation where price level rises without any price control measures by the government.
Detailed explanation-4: -Based on speed, there are 4 different types of inflation – hyperinflation, galloping, walking, and creeping.
Detailed explanation-5: -Inflation indicates the decrease in the purchasing power of a unit of the currency in the country. It is measured in percentages. It is categorized into three types, that is, Demand-pull, Cost-pull, and Built-in. The most commonly used inflation indexes are the Consumer Price Index (CPI) and Wholesale Price Index (WPI)