The group of goods and services used to compute the GDP deflator changes automatically over time, but the group of goods and services used to compute the CPI does not.

Question

Quizplus · Accepted Answer

The GDP deflator reflects the prices of all goods and services produced domestically and its basket changes with the production pattern, whereas the CPI measures the prices of a fixed basket of consumer goods and services, which does not change automatically over time.

The Group of Goods and Services Used to Compute the GDP