ECONOMICS
INFLATION
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Using demand and supply
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CPI
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Gini coeficient
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GDP
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Detailed explanation-1: -To calculate the CPI, the ABS collects prices for thousands of items, which are grouped into 87 categories (or expenditure classes) and 11 groups. Every quarter, the ABS calculates the price changes of each item from the previous quarter and aggregates them to work out the inflation rate for the entire CPI basket.
Detailed explanation-2: -Inflation is calculated by taking the price index from the year in interest and subtracting the base year from it, then dividing by the base year. This is then multiplied by 100 to give the percent change in inflation.
Detailed explanation-3: -Inflation is sometimes classified into three types: demand-pull inflation, cost-push inflation, and built-in inflation. The most commonly used inflation indexes are the Consumer Price Index and the Wholesale Price Index.