Consumer Price Index
The concept describes the Consumer Price Index (CPI) as an important economic indicator used by governments around the world. It explains how the CPI is calculated and why, and provides an overview of its strengths and weaknesses, as well as implementation advice.
Consumer Price Index Definition
The Consumer Price Index (CPI) is a measure of the overall cost of the goods and services purchased by a typical consumer (Mankiw, 2011). As the Statistical Office of the European Communities (Eurostat) states, this is an important measure of inflation in Europe and throughout the developed world (Conway, 2009). It measures the change over time in the prices of consumer goods and services acquired, used or paid for by households. Instead of the "typical consumer" concept, Eurostat refers to a "consumer basket" which is a representative set of consumed goods and services (Eurostat, 2010).
Consumer Price Index Description *
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Consumer Price Index Strengths *
Consumer Price Index Weaknesses *
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Consumer Price Index Implementation *
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Measures of Consumer Price Index *
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Consumer Price Index References (4 of up to 20) *
- Chandra, S., 2011. Consumer Prices in U.S. Climb More-Than-Estimated 0.5% on Fuel, Food Costs. Bloomberg, Jan 14. Available at: http://www.bloomberg.com/news/2011-01-14/consumer-prices-in-u-s-rose-0-5-in-december-core-up-0-1-.html.
- Conway, E., 2009. 50 Economics Ideas You Should Really Know. Quercus.
- Dean, J., 2011. China Consumer-Price Index Rises 4.9%. Wall Street Journal, Mar 11. Available at: http://online.wsj.com/article/SB10001424052748704399804576193313015672064.html.
- Dzabu, M.M., 2011. Ghana to Modify Consumer-Price Index With Phone, Education Costs. Bloomberg, Oct 26. Available at: http://www.businessweek.com/news/2011-10-26/ghana-to-modify-consumer-price-index-with-phone-education-costs.html.
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