Changes in the producer price index are often thought to be useful in predicting changes in
A)stock prices.
B)the consumer price index.
C)the unemployment rate.
D)the rate of output of goods and services.

Question

Quizplus · Accepted Answer

The producer price index (PPI) measures the average change over time in the selling prices received by domestic producers for their output. It is often used as an early indicator of inflationary pressures and can be useful in predicting changes in the consumer price index (CPI), which measures the average change in prices paid by consumers for a basket of goods and services. Therefore, changes in the PPI can be useful in predicting changes in the CPI.

Changes in the Producer Price Index Are Often Thought to Be