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O-LevelEconomicsGovernment and the macroeconomy2281/12 · Oct/Nov 2023 · Q231 Mark

What must have happened in a country when it experienced an annual rate of inflation of 100%?

AThe money supply doubled.
BThe price level halved.
CThe purchasing power of money halved.
DThe real value of money doubled.

✓ Correct answer

C: The purchasing power of money halved.

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About this question

Topic
Government and the macroeconomy, O-Level Economics (syllabus 2281). Multiple choice, 1 mark.
Source
O-Level Economics, Oct/Nov 2023 Paper 1 Variant 2, question 23.

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