GyanGramQuestion
A rapid increase in the rate of inflation is sometimes attributed to the “base effect”. What is “base effect”?
PRELIMS 2011 · INDIAN ECONOMY
A rapid increase in the rate of inflation is sometimes attributed to the “base effect”. W…
Attempt this previous-year question. The correct option stays hidden until you choose.
Pick an option to check yourself.
• Correct Answer: C
• Base effect is the distortion in current inflation caused by abnormally high or low price levels in the base year.
• A low base year inflates current year-on-year figures even with modest current rises.
Keep going in GyanGram.
Attempt Prelims MCQs or open Mains questions by paper — then continue the same bank inside the app with visual decks.