Inflation and Price Rise

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36. The term “sticky wages” refers to:
a) Wages that are flexible and adjust quickly to changes in inflation
b) Wages that are fixed and do not adjust quickly to changes in inflation
c) Wages that are adjusted daily based on inflation rates
d) Wages that are adjusted annually based on inflation rates

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37. Inflation can be harmful for individuals on fixed incomes, such as retirees, because it:
a) Increases their purchasing power
b) Decreases the cost of living
c) Reduces the value of their savings
d) Increases their disposable income

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38. Which of the following is an example of an expansionary fiscal policy to combat inflation?
a) Decreasing government spending
b) Decreasing taxes
c) Increasing interest rates
d) Decreasing money supply

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39. Which of the following is an example of an expansionary monetary policy to combat inflation?
a) Increasing government spending
b) Increasing taxes
c) Decreasing interest rates
d) Decreasing money supply

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40. The term “cost of living adjustment” (COLA) refers to:
a) A decrease in the cost of living due to inflation
b) An increase in wages or benefits to account for inflation
c) A decrease in wages or benefits due to inflation
d) An increase in the cost of living due to deflation

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