If we want to use a measure of inflation that foreshadows price changes before they affect prices at the retail level,we would base our measure of inflation on
A)the producer price index.
B)the consumer price index.
C)the GDP deflator.
D)the household price index.

Question

Quizplus · Accepted Answer

The producer price index (PPI) measures the average change over time in the selling prices received by domestic producers for their output. As such, it measures price changes at the wholesale level, before they are passed on to consumers in the form of higher retail prices. Therefore, the PPI is a good indicator of future price changes and is commonly used by economists and policymakers to track inflationary pressures in the economy.

If We Want to Use a Measure of Inflation That