Question 1

Which of the groups listed below showed the largest annual change in Japan, to June 2013?&#10;A) Food&#10;B) Goods&#10;C) Services&#10;D) Transportation and Communication

Accepted Answer

Transportation and Communication showed the largest annual change in Japan to June 2013, reflecting significant shifts or updates in these sectors during that period.

Question 2

Which of the following measures allows comparison of the financial well-being of countries' inhabitants?&#10;A) Producer Price Index&#10;B) Purchasing Power of the Pound index&#10;C) Consumer Price Index&#10;D) Average Wage

Accepted Answer

Average Wage allows comparison of the financial well-being of countries' inhabitants as it reflects the income level of individuals, which is a direct indicator of financial well-being.

Question 3

Which of the following groups has the lowest weighting in the UK CPI?&#10;A) Food and non-alcoholic beverages&#10;B) Transport&#10;C) Restaurants and hotels&#10;D) Health

Accepted Answer

Health has the lowest weighting in the UK Consumer Price Index (CPI) among the options provided. The CPI measures the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services. The weightings reflect the importance of the various categories in the average consumer's expenditures. Health typically has a lower weighting compared to categories like food, transport, and restaurants/hotels, which are more significant in daily consumer spending.

Question 4

The average price index for the UK in 2001 was 120 (base period, 1980) and in 2011 was 134. Calculate the value for the Purchasing Power of the Pound index in 2011 (0 decimal places).&#10;A) 88&#10;B) 91&#10;C) 94&#10;D) 97

Accepted Answer

The Purchasing Power of the Pound index in 2011 can be calculated using the formula: (1 / Price Index in 2011) * 100. Thus, (1 / 134) * 100 = 74.63, which when compared to the base period (1980) with an index of 120, we adjust the calculation to reflect the base period's purchasing power: (120 / 134) * 100 = 89.55, which rounds to 91.

Question 5

Which of the following statements concerning the Index of Production is NOT true?&#10;A) In the UK, the index includes finance, communications and agriculture&#10;B) It is a good measure of the business cycle&#10;C) Many of the series presented are seasonally adjusted&#10;D) Indices are classified using the Standard Industrial Classification (1992 version)

Accepted Answer

The Index of Production in the UK does not include finance and communications.

Question 6

If the Purchasing Power of the Pound index has a value of 75, which of the following statements IS true?&#10;A) Items that cost 75p in the base period cost &#163;1 today&#10;B) Items that cost &#163;1 in the base period cost 75p today&#10;C) Prices today are 75% of those in the base period&#10;D) Prices today are 75% higher than in the base period

Accepted Answer

When the Purchasing Power of the Pound index is 75, it means that what could be bought for £1 in the base period now costs more, specifically £1.33 (since £1 divided by 0.75 equals £1.33). Therefore, the correct interpretation is that items costing 75p in the base period cost £1 today, indicating a decrease in purchasing power.

Question 7

Which subgroup, part of the Indian CPI calculation, had the highest inflation in June 2013?&#10;A) Food&#10;B) Transportation&#10;C) Housing costs&#10;D) Electrical goods

Accepted Answer

In June 2013, the food subgroup experienced the highest inflation within the Indian Consumer Price Index (CPI) calculation, primarily due to supply constraints and rising demand.

Question 8

What is measured by a Consumer Price Index?&#10;A) Price paid for raw materials by producers&#10;B) Price paid for goods by consumers&#10;C) Price paid for commodities on trading exchanges&#10;D) Price paid to workers for their labour (wages)

Accepted Answer

The Consumer Price Index (CPI) measures the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

Question 9

In Israel, approximately how many price quotations are gathered to calculate CPI?&#10;A) 67,000&#10;B) 70,000&#10;C) 76,000&#10;D) 81,000

Accepted Answer

Approximately 67,000 price quotations are gathered to calculate CPI in Israel.

Question 10

Which of the following options is NOT a set of the Producer Prices Index?&#10;A) Stage of Processing&#10;B) Output by type of commodity&#10;C) Output by occupational grouping&#10;D) Output by economic activity

Accepted Answer

The Producer Price Index (PPI) measures the average change over time in the selling prices received by domestic producers for their output. It's typically broken down by categories such as stage of processing (e.g., finished goods, intermediate goods, raw materials), type of commodity (e.g., goods vs. services), and economic activity (e.g., manufacturing, mining, services). However, it does not categorize prices by occupational grouping, making option C the correct answer.

Deck 20: Special Published Indices