Understanding Inflation

The video explains inflation as a general increase in prices, affecting purchasing power. It discusses how inflation impacts savings and salaries, and explores its causes, including money supply and consumption. The video emphasizes the need for government control to balance inflation with economic growth.

What is inflation?

• A specific increase in the price of a single product.

• An increase in the general price level of goods and services.

• A decrease in the value of a single currency.

• A decrease in the general price level of goods and services.

What happens to your purchasing power when inflation occurs?

• It decreases.

• It increases.

• It fluctuates randomly.

• It remains the same.

If you save 100 reais and the inflation rate is 40% after one year, what is the value of your savings in terms of purchasing power?

• 140 reais

• 60 reais

• 40 reais

• 100 reais

If your salary increases by 10% but inflation also rises by 10%, what happens to your purchasing power?

• It increases by 10%.

• It decreases by 10%.

• It doubles.

• It remains the same.

What is one cause of inflation related to money circulation?

• Decreased production of goods.

• Increased speed of money circulation.

• Decreased consumer demand.

• Increased savings rates.

Why do prices tend to rise when there is more money in circulation?

• Because people spend less money.

• Because the government reduces taxes.

• Because people demand higher wages and prices increase.

• Because people save more money.

What happens when consumption increases too quickly?

• The economy slows down.

• Products become scarce and prices increase.

• Prices decrease.

• The government prints more money.

How is inflation similar to salt in food?

• It should be used in excess.

• It needs to be in the right amount.

• It should be avoided completely.

• It has no impact on the overall outcome.

What is the government's role in controlling inflation?

• To stop all economic activities.

• To balance money circulation and consumption.

• To ensure people spend as much as possible.

• To increase the amount of money in circulation.

What can happen if the economy grows too quickly?

• Prices stabilize.

• The economy remains steady.

• Inflation decreases.

• The economy can crash quickly.