The following is an example of one of the major categories in the overall cpi C. Recreation
CPI measures costs in the following areas:
Food and beverages, housing, clothes, medical care, recreation, education and communication etc.
A CPI is a statistical calculation created using a sample of representative items with prices that are frequently gathered.
For various categories and sub-categories of goods and services, sub-indices and sub-sub-sub-indices can be calculated. These sub-indices and sub-sub-indices are then combined to produce the overall index, with weights reflecting their shares in the total of the consumer expenditures covered by the index. I
t is one of many price indices that are computed by the majority of national statistics organizations. As a gauge of inflation, the annual percentage change in a CPI is utilized.
A CPI can be used to control prices, deflate monetary magnitudes to reflect changes in real values, and index (i.e. compensate for the effect of inflation) the real worth of wages, salaries, and pensions.
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