A measure of how fast the general level of prices is rising is called the:
A) growth rate of real GDP.
B) inflation rate.
C) unemployment rate.
D) market-clearing rate.

Question

Quizplus · Accepted Answer

The inflation rate measures the rate at which prices are increasing over time. A is incorrect because it measures the rate of increase in real GDP, which is a measure of the quantity of goods and services produced in the economy, not the price level. C is incorrect because it measures the percentage of the labor force that is unemployed, which is not directly related to changes in the price level. D is incorrect because the market-clearing rate refers to the price at which quantity demanded equals quantity supplied in a market, which is not necessarily related to changes in the overall price level.

A Measure of How Fast the General Level of Prices