-Consider Figure 12

question 41

Multiple Choice

-Consider Figure 12.8,which shows the change in inflation
From 1995.1 to 2000.4,by quarter.You are Federal Reserve chairman Greenspan and today's date is the second quarter of 1997 (1997.2) .Given the information you have,using the Phillips curve,to stabilize the economy,you would __________,risking __________.

• A)raise interest rates;recession
• B)raise interest rates;inflation
• C)lower interest rates;inflation
• D)lower interest rates;higher unemployment
• E)Not enough information is given.

Understand the criteria and processes for translating non-monetary items measured at historical cost or using the fair value method.

Recognize the requirement for disclosures relating to foreign currency translation in financial reports.

Interpret and apply AASB 121 The Effects of Changes in Foreign Exchange Rates in practical scenarios.

Understand the calculation and implications of portfolio variance.

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Definitions:

CPI

A calculation tool, the Consumer Price Index, measures the mean prices of a selected basket of consumer services and goods including food, transportation, and medical services via their weighted average.

Prices Increase

A rise in the general level of prices for goods and services in an economy over a period of time, often indicating inflation.

Unemployment Rate

The portion within the labor force actively seeking work yet remains unemployed.

Employed

Refers to individuals who are currently working for pay or profit, including full-time and part-time positions, as well as temporary and seasonal work.