Model Test 11

　　Inflation is an economic condition in 1 prices for consumer goods increase, and the value of money or purchasing power decreased. There a re three important causes of inflation. The first and most important cause may be 2 government spending. For example, insgroupsto 3 a war or carry 4 social programs, the government may spend more money than it has received through taxes and other 5 , thus creating a deficit. Insgroupsto 6 this deficit, the Treasury Department can simply 7 t he money supply by issuing more paper money to return the debts of government. T his increase in the money supply will cause the value of the dollar to 8 decrease. The second cause of inflation will occur when the money supply 9 faster than the supply of goods. 10 people have more money, they will run out to buy popular goods like televisions and computers, for example, and a 11 will b e the result. Industry will then produce more, at higher prices, to 12 the demand. 13 , if people think that the pr ices of popular goods are 14 , they will buy and even borr ow money at high 15 rates to pay for them. Finally, if labor unions demand that workers�饂ages 16 to suit the high cost of living, industry will meet this demand and add other 17 of production on the 18 . In summary, all of the se causes can 19 inflationary problems that can affect the welfare of a nation. However, 20 these three causes, excessive government spending may be the most important.

　　1.〔A〕this〔B〕that〔C〕which〔D〕what

　　2.〔A〕accessible〔B〕excessive〔C〕productive〔D〕processing

　　3.〔A〕finance〔B〕lower〔C〕pay〔D〕decrease

　　4.〔A〕off〔B〕out〔C〕on〔D〕away

　　5.〔A〕avenue〔B〕revenue〔C〕menu〔D〕income

　　6.〔A〕compensate〔B〕accomplish〔C〕exchange〔D〕offset

　　7.〔A〕spend〔B〕extend〔C〕expand〔D〕explore

　　8.〔A〕automatically〔B〕timely〔C〕exceedingly〔D〕excessively

　　9.〔A〕increases〔B〕decreases〔C〕declines〔D〕lifts

　　10.〔A〕If〔B〕Whether〔C〕Though〔D〕For fear that

　　11.〔A〕adequacy〔B〕sufficiency〔C〕abundance〔D〕shortage

　　12.〔A〕satisfy〔B〕supply〔C〕testify〔D〕comply

　　13.〔A〕However〔B〕Otherwise〔C〕Besides〔D〕Furthermore

　　14.〔A〕going up〔B〕going down〔C〕going of f〔D〕going away

　　15.〔A〕interests〔B〕interesting〔C〕interest ed〔D〕interest

　　16.〔A〕should increase〔B〕be increased〔C〕increase〔D〕increased

　　17.〔A〕expenditure〔B〕expenses〔C〕costs〔D〕materials

　　18.〔A〕consumer〔B〕controller〔C〕manager〔D〕employer

　　19.〔A〕result〔B〕invent〔C〕discover〔D〕create

　　20.〔A〕of〔B〕on〔C〕in〔D〕for

　　Key to Model Test 11

　　1.〔C〕2.〔B〕3.〔A〕3.〔B〕5.〔B〕6.〔D〕7.〔C〕8.〔A〕9.〔A〕10.〔A〕

　　11.〔D〕12.〔A〕13.〔A〕14.〔A〕15.〔D〕16.〔B〕17.〔C〕18.〔A〕19.〔D〕20.〔A〕