Inflation and CPI Quiz

The CPI measures the average change in retail prices of local and imported goods.

The two main causes of inflation are demand side factors and supply side factors.

Inflation affects income distribution as the cost of living increases drastically and affects everyone, but those with low income jobs are more likely to suffer during this time.

<p>Inflation is a general increase in the price level of goods and services in an economy over a period of time.</p> Signup and view all the answers

<p>The consumer price index (CPI) measures the average change in retail prices of local and imported goods over a period of time.</p> Signup and view all the answers

<p>The two main causes of inflation are demand side factors and supply side factors.</p> Signup and view all the answers

<p>China's rapid expansion in trade with other countries has been a major factor driving its economic growth. This has resulted in China becoming the world's largest trading nation, and has had a significant impact on Australia's economy, with China being Australia's largest export customer.</p> Signup and view all the answers

<p>China has aimed to increase its manufacturing capacity in order to provide for its own population and to export to other countries. This has contributed to China's high GDP growth rates, but has also required the importation of large quantities of raw materials from other countries.</p> Signup and view all the answers

<p>Australia imports a range of goods from China, including clothing, textiles, electronic goods, and home appliances. These goods are often produced more cheaply than in Australia, resulting in lower prices for consumers. This has contributed to a growth in GDP, particularly in the mid 2000s.</p> Signup and view all the answers