The consumer price index (CPI)is:
A) the measure of consumer prices in both rural and urban areas; it is calculated by adding up all prices.
B) a measure of the price level based on the consumption patterns of a typical consumer.
C) a measure of all prices in the economy.
D) a measure of food prices, because food is what is consumed.
E) a measure of food, clothing, and housing prices.

Question

Quizplus · Accepted Answer

The CPI is a measure of the price level based on the consumption patterns of a typical consumer. It calculates the average price change of a basket of goods and services consumed by households, including food, clothing, housing, transportation, and other expenses. It is not a measure of all prices in the economy or of food prices alone.

The Consumer Price Index (CPI)is