EPF Unit 2 Test

What does Gross Domestic Product (GDP) measure?

• The total number of goods and services exported by a country

• The final dollar value of all the goods and services produced within a country in a year

• The total amount of goods and services imported by a country

• The average income of individuals within a country

What is the Consumer Price Index (CPI) used to track?

• The changes in employment rates over time

• The changes in GDP over time

• The changes in price over time

• The changes in export quantities over time

What is a recession?

• A period of rapid economic growth

• A period of temporary economic decline identified by a rise in GDP

• A period of temporary economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters

• A period of stable economic activity without growth or decline

What does economic growth lead to?

• A decrease in the production of goods and services

• An increase in the unemployment rates

• An increase in the production of goods and services which may provide a higher standard of living

• A decrease in the standard of living

What do Unemployment Rates measure?

• The share of workers in the labor force who are overqualified for their current job

• The share of workers in the labor force who have never had a job

• The share of workers in the labor force who do not currently have a job but are actively looking for work

• The share of workers in the labor force who are retired

Why can the Unemployment Rate be deceiving?

• It counts everyone who doesn't have a job

• It only measures the share of workers actively looking for work, not those who have stopped looking

• It includes children and retired individuals

• It is always lower than the actual number of unemployed people

What does the Consumer Price Index (CPI) measure?

• The overall change in consumer prices based on a representative basket of goods and services over time.

• The total number of goods and services produced in a country.

• The average income level of consumers.

• The unemployment rate within the consumer market.

Who closely follows the CPI?

• Students and educational institutions.

• Policymakers, financial markets, businesses, and consumers.

• Tourists and travel agencies.

• Technology companies and startups.

How is the data for the CPI collected?

• Through annual surveys of consumer preferences.

• Based on 80,000 price quotes collected monthly from some 23,000 retail and service establishments as well as 50,000 rental housing units.

• By tracking stock market prices.

• Through census data collected every ten years.

Which of the following is NOT one of the 8 major groups of the Consumer Price Index as shown in the image?

• Apparel

• Technology

• Housing

• Medical Care