What is CPI?
CPI, or the Consumer Price Index, is a measure of the average price of goods and services purchased by consumers. It is used to calculate inflation, the rate at which prices for goods and services are rising. The CPI is one of the most commonly used economic indicators, as it provides a good indication of the health of the economy.
How is CPI calculated?
The CPI is calculated by taking a basket of goods and services which are representative of the average consumer, and then measuring the change in their prices over time. The basket of goods and services is updated periodically to reflect changing consumer habits and prices.
What does CPI measure?
CPI measures the average change in prices of goods and services purchased by consumers. It is used to measure inflation and gauge the health of the economy.
What are the uses of CPI?
CPI has many uses, including:
- It is used to measure inflation and the cost of living.
- It is used to adjust wages, pensions and other government benefits.
- It is used to adjust interest rates and mortgage payments.
- It is used to adjust taxes, such as VAT and income tax.
- It is used to measure the health of the economy.
Conclusion
The CPI is a key economic indicator, providing a good indication of the health of the economy. It is used to measure inflation and adjust wages, pensions and other government benefits. For more information on CPI, please visit: