Which price index tends to be the most volatile over time?
A) CPI
B) PCE
C) PPI
D) GDP deflator

Question

Quizplus · Accepted Answer

The Producer Price Index (PPI) tends to be the most volatile over time because it measures changes in the selling prices received by domestic producers for their output. This can fluctuate significantly due to changes in raw material costs, supply chain issues, and demand shifts, making it more volatile compared to other price indices like the Consumer Price Index (CPI), Personal Consumption Expenditures (PCE) price index, and the GDP deflator.

Which Price Index Tends to Be the Most Volatile Over