ECON 1002 Chapter Notes - Chapter 6: Lead, The Automatic, Real Interest Rate
Document Summary
A measure of the overall cost of the goods and services bought by a typical consumer. The cpi is used to monitor changes in the cost of living over time. Pt: price of basket of goods and services in a current year. Pb: price of basket in base year. It is computed and reported in stats canada every month. It uses data on the prices of more than 600 different goods and services. With the cpi, we can calculate the inflation rate. Steps to compute the inflation rate: determine the basket, which prices are more important to the typical consumer. Inflation rate: the % change in the price index from the preceding period, by measuring the prices of hundreds of goods, stats can. Computes how the cost of living is rising every year using those 5 steps: stats. Also measures inflation for provinces and 19 cities across canada: they include a more narrowed calculation on goods (food, clothes, shelter)