The Consumer Price Index measures
A) the average of raw material prices paid by producing firms.
B) the level of prices with respect to goods and services purchased by a typical consumer in urban areas.
C) the average of the prices of all goods produced in a country and goods imported from other countries.
D) hourly wage rates of manufacturing workers.

Question

Quizplus · Accepted Answer

The Consumer Price Index (CPI) measures the level of prices of a basket of goods and services purchased by a typical consumer in urban areas. It is calculated by taking the price of the basket of goods and services in a base year and comparing it to the price of the same basket in the current year. This helps to measure inflation and changes in the cost of living for consumers.

The Consumer Price Index Measures