ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Use the inflation rate formula Subtract the past date CPI from the current date CPI and divide your answer by the past date CPI. Multiply the results by 100. Your answer is the inflation rate as a percentage.

Detailed explanation-2: -The Consumer Price Index (CPI), produced by the Bureau of Labor Statistics (BLS), is the most widely used measure of inflation.

Detailed explanation-3: -As a means of adjusting dollar values. The CPI is often used to adjust consumers’ income payments (for example, Social Security), to adjust income eligibility levels for government assistance, and to automatically provide cost-of-living wage adjustments to millions of American workers.

Detailed explanation-4: -It is evaluated by taking a cost change of each product in the prearranged bags of goods and averaging them. The CPI changes are applied to estimate the price changes linked to the cost of living in the economy. The CPI is one of the most commonly used statistics for locating inflation or deflation periods.