Question

The Census Bureau surveys households for employment status, while the Labor Department focuses on the payrolls of businesses and government agencies to determine employment totals.

Question 1 options:

	a) False
	b) True

Which of the following statements describes a difference between the consumer price index (CPI) and the producer price index (PPI)?

Question 2 options:

	a) Only the PPI measures net revenues received by firms.
	b) Only the PPI has a fixed market basket.
	c) Only the PPI is associated with the problem of products dropped from the basket.
	d) Only the CPI is associated with the problem of quality changes.

In the 1960s, macroeconomists thought policymakers faced a menu of choices concerning the unemployment rate and the economic growth rate.

Question 3 options:

	a) True
	b) False

Which of the following items is NOT included in the GDP deflator?

Question 4 options:

	a) imported mangoes
	b) fire engines
	c) turbines
	d) bubble gum

Which of the following people would NOT be considered employed?

Question 5 options:

	a) a person working 10 hours a week for pay
	b) a full-time worker on vacation last week
	c) an unpaid family employee working 10 hours a week
	d) a unionized worker on strike

Answer 1

1.

True

Different government agencies conduct different surveys even if it is related to a particular indicator. In the given scenario, census and Labor department are conducting different data related to employment.

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2.

A

PPI deals with the products and its price. It can be interpreted as revenues received at the firm level.

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3.

True

At the given time, there was a trade off to be between unemployment and inflation rate. A decrease in inflation to control the price level, leads to increase in unemployment in short run, negatively affecting economic growth.

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4.

A

It is not considered in calculation in GDP deflator.

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5.

C

A person working at its own home, getting paid or unpaid, will not be considered employed.