Question 7 1 pt A decrease in the general price level O increase the purchasing

Question

Question 7 1 pt A decrease in the general price level O increase the purchasing power of money, fewer dollars are needed to purchase goods and services. O decreases the purchasing power of money, fewer dollars are needed to purchase goods and services. O increases the purchasing power of money, more dollars are needed to purchase goods and services. O decreases the purchasing power of money. more dolilars are needed to purchase goods and services. D Question 8 1 pts If the price index rises from 100 to 125, the value of the dollar will: rise by 20 percent. fall by 20 percent. fall by 25 percent. rise by 25 percent.

Explanation / Answer

7)

Answer-(a)

If decrease in general price levels that means increase in purchasing power .Fewer money is required to purchase good and services.

8)

Answer. (C)

Answer- ( new value- old value)/old value =(125-100)/100

= 0.25 or 25%

Value of dollars decrease by 25% because more dollar will go to less purchase goods.

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