100 IMPORTANT MULTIPLE CHOICE QUESTIONS WITH ANSWERS RELATED TO TIME SERIES & INDEX NUMBERS
- Time series analysis involves studying data points collected over a _______.
a) Specific time period
b) Random time period
c) Future time period
d) Variable time period
Answer: a) Specific time period - Which of the following is an example of a time series data?
a) Height of students in a classroom
b) Sales figures of a company
c) Temperature in different cities
d) All of the above
Answer: d) All of the above - The horizontal axis in a time series plot represents _______.
a) Time
b) Data values
c) Frequency
d) None of the above
Answer: a) Time - The main objective of time series analysis is to _______.
a) Predict future values
b) Analyze historical data
c) Identify patterns and trends
d) All of the above
Answer: d) All of the above - Which of the following techniques can be used to forecast time series data?
a) Moving average
b) Exponential smoothing
c) Box-Jenkins models
d) All of the above
Answer: d) All of the above - Which of the following measures the average value of a time series over a specific period?
a) Mean
b) Median
c) Mode
d) Range
Answer: a) Mean - Which of the following measures the dispersion or variability of a time series data set?
a) Variance
b) Standard deviation
c) Range
d) All of the above
Answer: d) All of the above - Which of the following is used to measure the strength and direction of the linear relationship between two time series variables?
a) Covariance
b) Correlation coefficient
c) Regression analysis
d) T-test
Answer: b) Correlation coefficient - Which of the following is a characteristic of a stationary time series?
a) Constant mean
b) Constant variance
c) Absence of seasonality
d) All of the above
Answer: d) All of the above - Which of the following methods can be used to detrend a time series?
a) Moving averages
b) Differencing
c) Logarithmic transformation
d) All of the above
Answer: d) All of the above - Index Numbers:
- Index numbers are used to measure changes in _______.
a) Prices
b) Quantities
c) Both prices and quantities
d) None of the above
Answer: c) Both prices and quantities - The base year in an index number is usually assigned a value of _______.
a) 0
b) 1
c) 100
d) 1000
Answer: c) 100 - Which of the following index numbers measures changes in the prices of goods and services consumed by households?
a) Producer Price Index (PPI)
b) Consumer Price Index (CPI)
c) Wholesale Price Index (WPI)
d) None of the above
Answer: b) Consumer Price Index (CPI) - The Laspeyres index is calculated using _______.
a) Current year quantities and base year prices
b) Base year quantities and current year prices
c) Current year quantities and current year prices
d) Base year quantities and base year prices
Answer: a) Current year quantities and base year prices - The Paasche index is calculated using _______.
a) Current year quantities and base year prices
b) Base year quantities and current year prices
c) Current year quantities and current year prices
d) Base year quantities and base year prices
Answer: b) Base year quantities and current year prices - The Fisher index is an example of a _______ index.
a) Fixed-base
b) Chain-base
c) Weighted
d) Unweighted
Answer: b) Chain-base - The Laspeyres index tends to overestimate inflation because it does not account for _______.
a) Changes in quantities
b) Changes in prices
c) Changes in both quantities and prices
d) None of the above
Answer: a) Changes in quantities - Which of the following index numbers is commonly used to measure changes in stock market prices?
a) Dow Jones Industrial Average (DJIA)
b) Standard & Poor’s 500 (S&P 500)
c) Nasdaq Composite Index
d) All of the above
Answer: d) All of the above - The concept of index numbers was first introduced by _______.
a) Karl Pearson
b) Sir William Petty
c) Irving Fisher
d) None of the above
Answer: b) Sir William Petty - The index number formula used to calculate the Consumer Price Index (CPI) is:
a) (Current Year Value / Base Year Value) × 100
b) (Base Year Value / Current Year Value) × 100
c) (Current Year Value – Base Year Value) × 100
d) None of the above
Answer: a) (Current Year Value / Base Year Value) × 100 - The base period in an index number is typically used as a reference for comparison and is assigned a value of _______.
a) 0
b) 1
c) 100
d) 1000
Answer: c) 100 - The Paasche index is commonly used to measure changes in _______.
a) Consumer prices
b) Producer prices
c) Both consumer and producer prices
d) None of the above
Answer: c) Both consumer and producer prices - The geometric mean index number is useful when _______.
a) Comparing relative changes over time
b) Comparing absolute changes over time
c) Comparing cross-sectional data
d) None of the above
Answer: a) Comparing relative changes over time - The Tornqvist index is an example of a _______ index.
a) Fixed-base
b) Chain-base
c) Weighted
d) Unweighted
Answer: c) Weighted - The Laspeyres index is biased towards _______.
a) Overestimating inflation
b) Underestimating inflation
c) Overestimating deflation
d) Underestimating deflation
Answer: b) Underestimating inflation - Which of the following index numbers is commonly used to measure changes in real GDP?
a) Consumer Price Index (CPI)
b) Producer Price Index (PPI)
c) Wholesale Price Index (WPI)
d) GDP Deflator
Answer: d) GDP Deflator - The chain index number method is used to _______.
a) Eliminate the biases of fixed-base index numbers
b) Simplify index number calculations
c) Adjust for seasonal variations in data
d) None of the above
Answer: a) Eliminate the biases of fixed-base index numbers - Which of the following methods is used to construct a price index when the base year and current year quantities are different?
a) Laspeyres index
b) Paasche index
c) Fisher index
d) None of the above
Answer: b) Paasche index - The index number method used to adjust for changes in the quality of goods and services over time is called _______.
a) Hedonic index
b) Chain index
c) Fisher index
d) None of the above
Answer: a) Hedonic index - The Laspeyres index is commonly used in the construction of _______.
a) Retail price indices
b) Producer price indices
c) Cost of living indices
d) All of the above
Answer: d) All of the above - The purpose of constructing an index number is to _______.
a) Measure changes over time
b) Compare different entities
c) Analyze trends and patterns
d) All of the above
Answer: d) All of the above - Which of the following index numbers measures changes in the prices of raw materials and goods purchased by producers?
a) Consumer Price Index (CPI)
b) Producer Price Index (PPI)
c) Wholesale Price Index (WPI)
d) None of the above
Answer: b) Producer Price Index (PPI) - The concept of “chain-linking” in index numbers refers to _______.
a) Combining multiple index numbers into a chain index
b) Adjusting for inflation in index calculations
c) Linking different base years in index calculations
d) None of the above
Answer: c) Linking different base years in index calculations - The Divisia index is used to measure changes in _______.
a) Quantity
b) Price
c) Both quantity and price
d) None of the above
Answer: c) Both quantity and price - The Laspeyres index is widely used for constructing _______.
a) Stock market indices
b) Cost of living indices
c) Producer price indices
d) All of the above
Answer: b) Cost of living indices - The Törnqvist index is a type of _______.
a) Fixed-base index
b) Chain index
c) Weighted index
d) Unweighted index
Answer: c) Weighted index - Which of the following index numbers is used to measure changes in the overall level of prices in an economy?
a) Consumer Price Index (CPI)
b) Producer Price Index (PPI)
c) Wholesale Price Index (WPI)
d) All of the above
Answer: d) All of the above - Which of the following index numbers is commonly used to measure changes in the prices of goods and services sold to businesses?
a) Consumer Price Index (CPI)
b) Producer Price Index (PPI)
c) Wholesale Price Index (WPI)
d) None of the above
Answer: c) Wholesale Price Index (WPI) - The Fisher index is a _______.
a) Simple average of Laspeyres and Paasche indices
b) Weighted average of Laspeyres and Paasche indices
c) Geometric mean of Laspeyres and Paasche indices
d) None of the above
Answer: c) Geometric mean of Laspeyres and Paasche indices - The Fisher index is used to _______.
a) Combine different base years in index calculations
b) Adjust for changes in the quality of goods and services
c) Eliminate the biases of fixed-base index numbers
d) None of the above
Answer: a) Combine different base years in index calculations - The index number formula used to calculate the unemployment rate is:
a) (Number of unemployed / Total labor force) × 100
b) (Number of employed / Total labor force) × 100
c) (Number of unemployed / Number of employed) × 100
d) None of the above
Answer: a) (Number of unemployed / Total labor force) × 100 - Which of the following index numbers measures changes in the average wages and salaries of employees?
a) Consumer Price Index (CPI)
b) Producer Price Index (PPI)
c) Employment Cost Index (ECI)
d) None of the above
Answer: c) Employment Cost Index (ECI) - The index number formula used to calculate the poverty rate is:
a) (Number of individuals below the poverty line / Total population) × 100
b) (Number of individuals above the poverty line / Total population) × 100
c) (Number of individuals below the poverty line / Number of individuals above the poverty line) × 100
d) None of the above
Answer: a) (Number of individuals below the poverty line / Total population) × 100 - The concept of index numbers is most commonly associated with _______.
a) Economics
b) Mathematics
c) Statistics
d) None of the above
Answer: a) Economics - Which of the following index numbers measures changes in the average level of education in a population?
a) Literacy Rate Index (LRI)
b) Education Price Index (EPI)
c) Human Development Index (HDI)
d) None of the above
Answer: c) Human Development Index (HDI) - The index number formula used to calculate the inflation rate is:
a) (Current year price level – Previous year price level) / Previous year price level × 100
b) (Current year price level – Previous year price level) / Current year price level × 100
c) (Current year price level + Previous year price level) / Previous year price level × 100
d) None of the above
Answer: a) (Current year price level – Previous year price level) / Previous year price level × 100 - The index number formula used to calculate the exchange rate is:
a) (Foreign currency value / Domestic currency value) × 100
b) (Domestic currency value / Foreign currency value) × 100
c) (Foreign currency value – Domestic currency value) × 100
d) None of the above
Answer: b) (Domestic currency value / Foreign currency value) × 100 - Which of the following index numbers measures changes in the level of industrial production?
a) Consumer Price Index (CPI)
b) Producer Price Index (PPI)
c) Industrial Production Index (IPI)
d) None of the above
Answer: c) Industrial Production Index (IPI) - The index number formula used to calculate the stock market index is:
a) (Current market value of the index / Base market value of the index) × 100
b) (Base market value of the index / Current market value of the index) × 100
c) (Current market value of the index – Base market value of the index) × 100
d) None of the above
Answer: a) (Current market value of the index / Base market value of the index) × 100 - The index number formula used to calculate the population growth rate is:
a) (Current year population – Previous year population) / Previous year population × 100
b) (Current year population – Previous year population) / Current year population × 100
c) (Current year population + Previous year population) / Previous year population × 100
d) None of the above
Answer: a) (Current year population – Previous year population) / Previous year population × 100 - Which of the following index numbers measures changes in the level of exports and imports?
a) Consumer Price Index (CPI)
b) Producer Price Index (PPI)
c) Trade Price Index (TPI)
d) None of the above
Answer: c) Trade Price Index (TPI) - The index number formula used to calculate the GDP growth rate is:
a) (Current year GDP – Previous year GDP) / Previous year GDP × 100
b) (Current year GDP – Previous year GDP) / Current year GDP × 100
c) (Current year GDP + Previous year GDP) / Previous year GDP × 100
d) None of the above
Answer: a) (Current year GDP – Previous year GDP) / Previous year GDP × 100 - The index number formula used to calculate the productivity growth rate is:
a) (Current year output – Previous year output) / Previous year output × 100
b) (Current year output – Previous year output) / Current year output × 100
c) (Current year output + Previous year output) / Previous year output × 100
d) None of the above
Answer: a) (Current year output – Previous year output) / Previous year output × 100 - Which of the following index numbers measures changes in the level of investment in an economy?
a) Consumer Price Index (CPI)
b) Producer Price Index (PPI)
c) Investment Price Index (IPI)
d) None of the above
Answer: c) Investment Price Index (IPI) - The index number formula used to calculate the bond yield is:
a) (Annual interest payment / Current bond price) × 100
b) (Current bond price / Annual interest payment) × 100
c) (Current bond price – Annual interest payment) × 100
d) None of the above
Answer: a) (Annual interest payment / Current bond price) × 100 - The index number formula used to calculate the business confidence index is:
a) (Number of positive responses / Total responses) × 100
b) (Number of negative responses / Total responses) × 100
c) (Number of positive responses – Number of negative responses) × 100
d) None of the above
Answer: a) (Number of positive responses / Total responses) × 100 - The index number formula used to calculate the customer satisfaction index is:
a) (Number of satisfied customers / Total number of customers) × 100
b) (Number of dissatisfied customers / Total number of customers) × 100
c) (Number of satisfied customers – Number of dissatisfied customers) × 100
d) None of the above
Answer: a) (Number of satisfied customers / Total number of customers) × 100 - Which of the following index numbers measures changes in the level of technological innovation?
a) Research and Development Index (RDI)
b) Technology Price Index (TPI)
c) Innovation Index (II)
d) None of the above
Answer: c) Innovation Index (II) - The index number formula used to calculate the environmental sustainability index is:
a) (Current year environmental performance – Base year environmental performance) / Base year environmental performance × 100
b) (Current year environmental performance – Base year environmental performance) / Current year environmental performance × 100
c) (Current year environmental performance + Base year environmental performance) / Base year environmental performance × 100
d) None of the above
Answer: a) (Current year environmental performance – Base year environmental performance) / Base year environmental performance × 100 - The index number formula used to calculate the happiness index is:
a) (Sum of happiness scores / Total number of respondents) × 100
b) (Sum of unhappiness scores / Total number of respondents) × 100
c) (Sum of happiness scores – Sum of unhappiness scores) × 100
d) None of the above
Answer: a) (Sum of happiness scores / Total number of respondents) × 100 - The index number formula used to calculate the crime rate is:
a) (Number of reported crimes / Total population) × 100
b) (Number of arrests / Total population) × 100
c) (Number of reported crimes – Number of arrests) × 100
d) None of the above
Answer: a) (Number of reported crimes / Total population) × 100 - Which of the following index numbers measures changes in the level of healthcare expenditure?
a) Consumer Price Index (CPI)
b) Producer Price Index (PPI)
c) Healthcare Price Index (HPI)
d) None of the above
Answer: c) Healthcare Price Index (HPI) - The index number formula used to calculate the happiness index is:
a) (Sum of happiness scores / Total number of respondents) × 100
b) (Sum of unhappiness scores / Total number of respondents) × 100
c) (Sum of happiness scores – Sum of unhappiness scores) × 100
d) None of the above
Answer: a) (Sum of happiness scores / Total number of respondents) × 100 - Which of the following index numbers measures changes in the level of poverty and inequality?
a) Poverty Index (PI)
b) Gini Index (GI)
c) Inequality Index (II)
d) None of the above
Answer: b) Gini Index (GI) - The index number formula used to calculate the climate change index is:
a) (Current year greenhouse gas emissions – Base year greenhouse gas emissions) / Base year greenhouse gas emissions × 100
b) (Current year greenhouse gas emissions – Base year greenhouse gas emissions) / Current year greenhouse gas emissions × 100
c) (Current year greenhouse gas emissions + Base year greenhouse gas emissions) / Base year greenhouse gas emissions × 100
d) None of the above
Answer: a) (Current year greenhouse gas emissions – Base year greenhouse gas emissions) / Base year greenhouse gas emissions × 100 - Which of the following index numbers measures changes in the level of energy consumption?
a) Energy Price Index (EPI)
b) Energy Consumption Index (ECI)
c) Energy Efficiency Index (EEI)
d) None of the above
Answer: b) Energy Consumption Index (ECI) - The index number formula used to calculate the education attainment index is:
a) (Number of individuals with a certain level of education / Total population) × 100
b) (Number of individuals without a certain level of education / Total population) × 100
c) (Number of individuals with a certain level of education – Number of individuals without a certain level of education) × 100
d) None of the above
Answer: a) (Number of individuals with a certain level of education / Total population) × 100 - Which of the following index numbers measures changes in the level of internet penetration?
a) Internet Price Index (IPI)
b) Internet Usage Index (IUI)
c) Digital Divide Index (DDI)
d) None of the above
Answer: b) Internet Usage Index (IUI) - The index number formula used to calculate the environmental pollution index is:
a) (Current year pollution levels – Base year pollution levels) / Base year pollution levels × 100
b) (Current year pollution levels – Base year pollution levels) / Current year pollution levels × 100
c) (Current year pollution levels + Base year pollution levels) / Base year pollution levels × 100
d) None of the above
Answer: a) (Current year pollution levels – Base year pollution levels) / Base year pollution levels × 100 - Which of the following index numbers measures changes in the level of social media usage?
a) Social Media Index (SMI)
b) Internet Usage Index (IUI)
c) Digital Engagement Index (DEI)
d) None of the above
Answer: a) Social Media Index (SMI) - The index number formula used to calculate the literacy rate is:
a) (Number of literate individuals / Total population) × 100
b) (Number of illiterate individuals / Total population) × 100
c) (Number of literate individuals – Number of illiterate individuals) × 100
d) None of the above
Answer: a) (Number of literate individuals / Total population) × 100 - Which of the following index numbers measures changes in the level of government effectiveness?
a) Government Performance Index (GPI)
b) Governance Index (GI)
c) Public Sector Efficiency Index (PSEI)
d) None of the above
Answer: b) Governance Index (GI) - The index number formula used to calculate the market share index is:
a) (Company’s sales / Total market sales) × 100
b) (Total market sales / Company’s sales) × 100
c) (Company’s sales – Total market sales) × 100
d) None of the above
Answer: a) (Company’s sales / Total market sales) × 100 - Which of the following index numbers measures changes in the level of infrastructure development?
a) Infrastructure Price Index (IPI)
b) Infrastructure Development Index (IDI)
c) Public Works Index (PWI)
d) None of the above
Answer: b) Infrastructure Development Index (IDI) - The index number formula used to calculate the credit risk index is:
a) (Number of defaults / Total loans) × 100
b) (Number of non-performing loans / Total loans) × 100
c) (Number of defaults – Number of non-performing loans) × 100
d) None of the above
Answer: b) (Number of non-performing loans / Total loans) × 100 - The index number formula used to calculate the air quality index is:
a) (Current year air pollution levels – Base year air pollution levels) / Base year air pollution levels × 100
b) (Current year air pollution levels – Base year air pollution levels) / Current year air pollution levels × 100
c) (Current year air pollution levels + Base year air pollution levels) / Base year air pollution levels × 100
d) None of the above
Answer: a) (Current year air pollution levels – Base year air pollution levels) / Base year air pollution levels × 100 - Which of the following index numbers measures changes in the level of food prices?
a) Food Price Index (FPI)
b) Consumer Price Index (CPI)
c) Wholesale Price Index (WPI)
d) None of the above
Answer: a) Food Price Index (FPI) - The index number formula used to calculate the gender equality index is:
a) (Number of females / Total population) × 100
b) (Number of males / Total population) × 100
c) (Number of females – Number of males) × 100
d) None of the above
Answer: a) (Number of females / Total population) × 100 - Which of the following index numbers measures changes in the level of transportation costs?
a) Transport Price Index (TPI)
b) Transportation Cost Index (TCI)
c) Logistics Index (LI)
d) None of the above
Answer: a) Transport Price Index (TPI) - The index number formula used to calculate the human development index is:
a) (Life expectancy + Education Index + Gross National Income) / 3
b) (Life expectancy – Education Index – Gross National Income) / 3
c) (Life expectancy × Education Index × Gross National Income) / 3
d) None of the above
Answer: a) (Life expectancy + Education Index + Gross National Income) / 3 - The index number formula used to calculate the housing affordability index is:
a) (Median house price / Median household income) × 100
b) (Median household income / Median house price) × 100
c) (Median house price – Median household income) × 100
d) None of the above
Answer: a) (Median house price / Median household income) × 100 - Which of the following index numbers measures changes in the level of customer loyalty?
a) Customer Satisfaction Index (CSI)
b) Net Promoter Score (NPS)
c) Customer Loyalty Index (CLI)
d) None of the above
Answer: c) Customer Loyalty Index (CLI) - The index number formula used to calculate the labor productivity index is:
a) (Total output / Total hours worked) × 100
b) (Total hours worked / Total output) × 100
c) (Total output – Total hours worked) × 100
d) None of the above
Answer: a) (Total output / Total hours worked) × 100 - Which of the following index numbers measures changes in the level of income inequality?
a) Gini Index (GI)
b) Poverty Index (PI)
c) Inequality Index (II)
d) None of the above
Answer: a) Gini Index (GI) - The index number formula used to calculate the cost of living index is:
a) (Current year cost of living – Base year cost of living) / Base year cost of living × 100
b) (Current year cost of living – Base year cost of living) / Current year cost of living × 100
c) (Current year cost of living + Base year cost of living) / Base year cost of living × 100
d) None of the above
Answer: a) (Current year cost of living – Base year cost of living) / Base year cost of living × 100 - Which of the following index numbers measures changes in the level of government debt?
a) Debt-to-GDP Ratio
b) Government Debt Index (GDI)
c) Public Debt Index (PDI)
d) None of the above
Answer: a) Debt-to-GDP Ratio - The index number formula used to calculate the technology adoption index is:
a) (Number of technology adopters / Total population) × 100
b) (Number of non-adopters / Total population) × 100
c) (Number of technology adopters – Number of non-adopters) × 100
d) None of the above
Answer: a) (Number of technology adopters / Total population) × 100 - Which of the following index numbers measures changes in the level of tourism activity?
a) Tourist Price Index (TPI)
b) Tourism Demand Index (TDI)
c) Visitor Arrivals Index (VAI)
d) None of the above
Answer: c) Visitor Arrivals Index (VAI) - The index number formula used to calculate the income growth index is:
a) (Current year income – Base year income) / Base year income × 100
b) (Current year income – Base year income) / Current year income × 100
c) (Current year income + Base year income) / Base year income × 100
d) None of the above
Answer: a) (Current year income – Base year income) / Base year income × 100 - Which of the following index numbers measures changes in the level of unemployment?
a) Unemployment Rate
b) Joblessness Index (JI)
c) Labor Force Participation Rate (LFPR)
d) None of the above
Answer: a) Unemployment Rate - The index number formula used to calculate the innovation index is:
a) (Total number of patents granted / Total population) × 100
b) (Total number of patents granted – Total population) × 100
c) (Total number of patents granted + Total population) × 100
d) None of the above
Answer: a) (Total number of patents granted / Total population) × 100 - Which of the following index numbers measures changes in the level of consumer confidence?
a) Consumer Confidence Index (CCI)
b) Consumer Price Index (CPI)
c) Consumer Sentiment Index (CSI)
d) None of the above
Answer: a) Consumer Confidence Index (CCI) - The index number formula used to calculate the productivity index is:
a) (Output per worker in the current year / Output per worker in the base year) × 100
b) (Output per worker in the current year – Output per worker in the base year) × 100
c) (Output per worker in the current year + Output per worker in the base year) × 100
d) None of the above
Answer: a) (Output per worker in the current year / Output per worker in the base year) × 100 - Which of the following index numbers measures changes in the level of export performance?
a) Export Price Index (EPI)
b) Export Volume Index (EVI)
c) Export Competitiveness Index (ECI)
d) None of the above
Answer: b) Export Volume Index (EVI) - The index number formula used to calculate the population growth rate is:
a) (Current year population – Base year population) / Base year population × 100
b) (Current year population – Base year population) / Current year population × 100
c) (Current year population + Base year population) / Base year population × 100
d) None of the above
Answer: a) (Current year population – Base year population) / Base year population × 100 - Which of the following index numbers measures changes in the level of stock market performance?
a) Stock Price Index (SPI)
b) Market Capitalization Index (MCI)
c) Stock Market Index (SMI)
d) None of the above
Answer: c) Stock Market Index (SMI) - The index number formula used to calculate the inflation rate is:
a) (Current year price level – Base year price level) / Base year price level × 100
b) (Current year price level – Base year price level) / Current year price level × 100
c) (Current year price level + Base year price level) / Base year price level × 100
d) None of the above
Answer: a) (Current year price level – Base year price level) / Base year price level × 100 - Which of the following index numbers measures changes in the level of customer satisfaction?
a) Customer Satisfaction Index (CSI)
b) Net Promoter Score (NPS)
c) Customer Loyalty Index (CLI)
d) None of the above
Answer: a) Customer Satisfaction Index (CSI) - The index number formula used to calculate the export-import ratio is:
a) (Value of exports / Value of imports) × 100
b) (Value of imports / Value of exports) × 100
c) (Value of exports – Value of imports) × 100
d) None of the above
Answer: a) (Value of exports / Value of imports) × 100
