The Full form of CPI is the Consumer Price Index. It is said that the customer is the king of the market. Likewise, CPI is a measure that determines the market conditions. The fact is that CPI influences the price of the market. The Customer Price Index is abbreviated as CPI. The market condition is based on many factors. In general, supply, demand plays a vital role. On the other hand, the consumer also plays an important role. The level of the price depends upon the consumer. Along with that, we have some other factors also. They are transport, food & medical care. Now let us see how the price index is fixed. Usually, producers fix prices based on factors. One such important factor is the consumer. Hear, CPI=Predetermined basket of goods/ average. In mathematics, it can be said differently. That is CPI= Cost + Year/cost of market * 100. However, CPI is widely used in economic terms. It is also one of the indicators of the market. Moreover, goods & services are also taken into consideration. Along with that few other factors also determine the CPI. Some of the factors are housing, apparel. Along with that transport, medical care.
Is a high CPI rate is good for the users?
Yes the CPI is the most common economic indicator which is checked by the people for the economy of the country. Known as the best measuring which can determine the cost of changing in human life. It is known as legal and can change rapidly as per the condition.
Let’s find out the difference between consumer and customer-:
The customer is the one who is buying the goods. The consumer is the one who is the end-user of any goods or services. Consumers are unable to resell any product or service. Customers require to buy a product or service in order to utilize it.
Inflation is measured using CPI. National statistical agencies calculate the final overall index of the price which is based on indices and sub-indices. CPI gives an idea of the cost of living. Bureau of Labor Statistics reports the CPI in the US. Joseph Lowe an English economist first proposed the theory of price basket index in 1832.
What is considered and not considered while preparing Consumer Price Index (CPI)?
In CPI, taxes paid for water and sewer services by the consumer are considered. On the other hand, income taxes and investment made by consumers such as stocks, bonds, and life insurance are not considered in CPI.
| Term | Full Form |
| CPI | Consumer Price Index |
FAQ’s
It is said that customer is the king of the market. Likewise, CPI is a measure that determines the market conditions. The fact is that CPI influences the price of the market. The Customer Price Index is abbreviated as CPI. The market condition is based on many factors. In general, supply, demand plays a vital role. On the other hand, the consumer also plays an important role.
CPI is short form of Consumer Price Index.
Consumer Price Index is Full Form of CPI.
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