alleryWhat happens to the purchasing power of money during price inflation?
AIt stays constant
BIt decreases
CIt grows steadily
DIt multiplies
Answer & Solution
Correct answer: B. It decreases
Inflation reduces the volume of goods each unit of currency can purchase.
Keep practising Money, Banking & Inflation
Browse all Money, Banking & Inflation questions for ICSE Class 10, or explore more Economics topics.
Related questions
Match PBOC powers:
1. PBOC: p. High power
2. Yuan: q. Inconvert
3. Rule: r. Strict CRRMatch bank bills:
1. English: p. Common
2. Act: q. Bills of Ex
3. Law: r. Section 2Match TLTRO policy:
1. ECB: p. Dual rates
2. Target: q. Green
3. Rate: r. DiscountMatch window guide:
1. Japan: p. Window
2. France: q. Post-war
3. Quota: r. LendingMatch monetary base:
1. Base: p. Currency
2. Money: q. Reserves
3. Unit: r. High powerMatch forward word:
1. Plan: p. Forecast
2. Target: q. Market
3. Word: r. GuidanceMatch historic title:
1. Old: p. Issue bank
2. Term: q. Notenbank
3. Role: r. CurrencyMatch rates effect:
1. High r: p. Squeeze
2. Outlay: q. Drop
3. Price: r. Subdued