Besides measuring change in the prices of goods and services, the consumer price index has a number of other applications such as:
A) To determine real disposable personal income
B) To deflate sales or other data series
C) To find the purchasing power of the dollar
D) All of the above.

Question

Quizplus · Accepted Answer

All options listed (A, B, and C) are valid applications of the consumer price index. The index can be used to determine the change in real income by adjusting nominal income figures for inflation. Similarly, it can be used to deflate sales or other data series to get a more accurate picture of changes in economic activity. Finally, it can be used to track changes in the purchasing power of the dollar over time.

Besides Measuring Change in the Prices of Goods and Services