Inflation Questions and Answers Grade 12

Inflation measures how quickly the prices of goods and services are rising. Inflation is sometimes classified into three types: demand-pull inflation, cost-push inflation, and built-in inflation.

Inflation Questions and Answers Grade 12

The most commonly used inflation indexes are the Consumer Price Index and the Wholesale Price Index.

Activity 1
Study Figure 12.2 below and answer the questions that follow:

1. Define the concept inflation. (2)
2. When did the inflation rate peak? (2)
3. Do we adhere to the inflation target set by government from July 2010–Jan 2011? Supply figures. (4)
4. Explain what you would do to lower the inflation rate in our country? (4)
5. Which institutions in South Africa make inflation figures available? (2)
6. What, according to you, caused the double figures in April–July 2008? (4)
7. Why are these figures in the graph not a reflection of hyperinflation? (4)
   [22]

Activity 2
Study the cartoon below and answer the questions that follow:

1. What is the message behind the cartoon? (2)
2. What is happening to the purchasing power of the money? (2)
3. In which country is this woman a consumer? Motivate your answer. (4)
   [8]

Activity 3
Name any THREE fiscal measures to control inflation. (3 × 2) [6]