Measures of economic performance: Practice Questions

In the calculation of the Consumer Price Index (CPI), why are different weights assigned to various categories of goods and services?

In an economy, the price level increases from \( 100 \) to \( 108 \) in Year 1, and from \( 108 \) to \( 112 \) in Year 2. Which of the following best describes the economic condition in Year 2 compared to Year 1?

A worker is unemployed because they have just graduated from university and are currently looking for their first job. This is an example of:

The closure of several textile factories in a specific region due to a long-term decline in the global demand for domestically produced cloth is most likely to result in:

Which of the following is most likely to be included in the calculation of a country's Consumer Price Index (CPI)?

What term is used to describe the total value of all goods and services produced within a country's borders in a specific time period, adjusted for inflation?

Explain the difference between disinflation and deflation.

Suppose an economy has a negative output gap. Briefly explain what this indicates about the level of unemployment and the use of resources in that economy.