Energy costs rise sharply at the same time as consumer spending falls. What can be concluded about inflation?
Inflation must rise because only costs matter
Inflation must fall because only spending matters
The general price level must remain unchanged
The cost-push and demand effects work in opposite directions, so the overall effect is uncertain
30 exam-style questions on OCR GCSE Economics 3.4 Price stability, covering 3.4.1 Price stability and inflation, 3.4.2 Measuring inflation with CPI, 3.4.3 Calculate the effect of inflation, 3.4.4 Analyse inflation figures, and 3.4.5 Causes and consequences of inflation. Each one has a worked solution and a mark scheme showing where the marks go.