Question

What is the purpose of the consumer price index?

a. To determine the amount of tax revenues the government will collect
b. To encourage employers to hire more workers
c. To measure changes in prices
d. To project innovations in manufacturing

Answer 1

The purpose of the consumer price index is c) to measure changes in prices. The consumer price index measures changes in the price level of a market basket of consumer goods and services purchased by households. The consumer price index is a statistical estimate. Weighting data is also used for the consumer price index.