Explanation:

Both statements 1&2 are correct.
CPI

• The Consumer Price Index (CPI) is a measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care.
• Changes in the CPI are used to assess price changes associated with the cost of living.
• The Consumer Price Index does not include things like savings and investments and can often exclude spending by foreign visitors.

The 8 major groups used in calculating CPI:

• Housing; Apparel; Transportation; Education and Communication; Other Goods and Services; Recreation; Medical Care; Food and Beverages.

PPI

• The producer price index (PPI), which instead of considering prices paid by consumers looks at what businesses pay for inputs.
• The PPI relies on the same calculation formula as the WPI, but it includes the prices of services, as well as physical goods, and eliminates the component of indirect taxes from prices.
• The PPI consists of three indexes, covering different stages of production: industry, commodity, and commodity-based final demand-intermediate demand.

Hence option 1st is correct.