3. Introduction
The Consumer Price Index (CPI) measures the change in prices paid by consumers for
goods and services.
Cpi is the most governmentโs โ most importantโ statistic
Affects on election, economy, government policies and pensions
4. Features
A price index is a measure of the percentage, changes in a set of prices over time.
A consumer price index (CPI)measures changes in the prices of goods and services that
households consume
Such changes affect the real purchasing power of consumers' incomes and their
welfare.
5. Important
The CPI is one of the most commonly used tools to measure inflation and deflation.
Inflation is an important indicator of an economy's health.
Governments and central banks use the CPI and other indices to make economic
decisions.
Key among these is whether to raise or lower interest rates.
6. Types of consumer price index
In India, the base years of the current series of
CPI(RL), rural labor 1984-85
CPI(IW), industrial work 1982
CPI(AL), aluminum 1986-87 respectively
7. Uses of consumer price index
The items that are considered as goods related to food, clothing, transportation, housing,
electronics, education, medicine, etc.
CPI can be used to calculate the cost of living of the people of a country and also the
changes in the purchasing power of the currency of a nation.
