Which of the following would be the best measure of the cost of living?
A)real GDP
B)real GDP per person
C)GDP deflator
D)consumer price index

Question

Quizplus · Accepted Answer

The consumer price index (CPI) is a measure of the average prices of goods and services purchased by households. It is a widely used measure of inflation and is often used as a measure of the cost of living. The CPI calculates how much it would cost to purchase a fixed basket of goods and services, and the percentage change in CPI reflects the percentage change in the cost of living. Therefore, the consumer price index is the best measure of the cost of living among the options given.

Which of the Following Would Be the Best Measure of the Cost