#1
2. What does the Consumer Price Index (CPI) measure?
The inflation rate of consumer goods and services
ExplanationIt gauges changes in the cost of a basket of goods and services over time.
#2
4. What is the primary purpose of the Gross Domestic Product (GDP)?
To quantify the total value of goods and services produced in a country
ExplanationGDP measures a nation's economic output and overall economic health.
#3
1. Which of the following is considered a leading economic indicator?
Stock Market Performance
ExplanationIt reflects investors' expectations and is considered predictive of economic trends.
#4
3. Inflation is generally measured by changes in which index?
Consumer Price Index (CPI)
ExplanationCPI tracks the average change in prices paid by consumers for goods and services.
#5
7. How is the unemployment rate calculated?
Number of unemployed people divided by the total labor force
ExplanationIt represents the percentage of the labor force that is unemployed and actively seeking employment.
#6
8. What is the Purchasing Managers' Index (PMI) used to measure?
Manufacturing sector activity
ExplanationPMI gauges the health of the manufacturing sector, indicating expansion or contraction.
#7
10. In the context of economic indicators, what does the term 'Gini Coefficient' measure?
Income inequality
ExplanationIt quantifies the extent of income inequality within a population.
#8
12. What does the term 'GDP per capita' represent?
Total GDP divided by the population
ExplanationIt provides the average economic output per person and helps assess the standard of living.
#9
5. Which economic indicator is often referred to as a lagging indicator?
Gross Domestic Product (GDP)
ExplanationGDP tends to reflect past economic performance and is not as responsive to short-term changes.
#10
6. What does the term 'stagflation' refer to in the context of economic indicators?
A situation where inflation and unemployment coexist
ExplanationIt describes an unusual combination of stagnant economic growth, high inflation, and high unemployment.
#11
9. Which of the following is a characteristic of hyperinflation?
Sudden and extreme increase in prices
ExplanationHyperinflation is marked by rapid and excessive increases in the price levels of goods and services.
#12
11. Which of the following is an example of a lagging economic indicator?
Unemployment Rate
ExplanationThe unemployment rate tends to change after shifts in the economic cycle, making it a lagging indicator.
#13
13. What impact does a high Consumer Confidence Index typically have on the economy?
Increased spending and investment
ExplanationHigh consumer confidence often leads to greater consumer spending and business investment.
#14
15. What is the relationship between the Producer Price Index (PPI) and inflation?
PPI is a leading indicator of inflation
ExplanationPPI measures the average change over time in selling prices received by domestic producers and can signal future inflation trends.