A chain-weighted index recognizes the fact that the composition of output changes over time.

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A chain-weighted index is designed to adjust for changes in the composition of output over time, recognizing that different goods and services may grow or decline at different rates. This type of index is considered a more accurate measure of inflation or economic growth compared to fixed-weighted indexes, which assume a fixed basket of goods and services over time.

A Chain-Weighted Index Recognizes the Fact That the Composition of Output