The personal consumption expenditures price index does a better job in approximating the cost of living than does the consumer price index.

Question

Quizplus · Accepted Answer

The personal consumption expenditures (PCE) price index is considered to be a more comprehensive measure of inflation than the consumer price index (CPI) because it reflects changes in consumption patterns and includes a wider range of goods and services. Therefore, it generally provides a more accurate picture of changes in the overall cost of living.

The Personal Consumption Expenditures Price Index Does a Better Job