Unemployment and the Cost of Living

label Economics
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How do we use consumer price index (CPI) to measure the cost of living? What is the relationship between CPI and rate of inflation?

Jul 14th, 2015

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The CPI measures the changes in the prices of goods and services and is a part of cost of living index. Earlier, the CPI was considered an upper bound to a cost-of-living index because the CPI did not reflect the changes in buying or consumption patterns that consumers would make to adjust to relative price changes.

The rate of inflation for the factors under consideration will be included in the report of the CPI measurement at the end of each month, and a general annual calculation for the rate of inflation will be included at the end of each year.

http://www.bls.gov/dolfaq/bls_ques2.htm

http://www.wisegeek.com/what-is-the-connection-between-inflation-and-cpi.htm


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Jul 14th, 2015

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