Stagflation Exists When Prices

question 387

Multiple Choice

Stagflation exists when prices

• A)and output rise.
• B)rise and output falls.
• C)fall and output rises.
• D)and output fall.

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Definitions:

Inflation

The rate at which the general level of prices for goods and services is rising, and subsequently, purchasing power is falling.

Par Value

The nominal or face value of a bond, share of stock, or other financial instrument, as stated by the issuer.

Yield to Maturity

The anticipated full income on a bond, provided it is held through to its expiration date.

Interest Rate Risk

The risk of losing money on investments because of changes in interest rates.