In August 2012,the CPI inflation rate was 0.6 percent while the core CPI inflation rate was 0.1 percent. The difference between these two measurements of inflation indicates
A) prices for food and fuel were increasing more rapidly than prices for other goods.
B) prices for food and fuel were increasing less rapidly than prices for other goods.
C) the underlying inflation rate was higher than the overall inflation rate.
D) a negative underlying inflation rate.

Question

Quizplus · Accepted Answer

The core CPI excludes food and fuel prices, which are typically more volatile. A higher overall CPI inflation rate compared to the core CPI suggests that food and fuel prices were rising faster than other goods.

In August 2012,the CPI Inflation Rate Was 0