Glossary · Macro · Inflation

Consumer price index (CPI)

The cost of a fixed basket of goods a typical household buys, expressed relative to a base year set at 100. If the basket cost 100 in the base year and 105 now, the CPI is 105 and prices are up 5 percent.

Also called: CPI, cost of living index

Taught in: Measuring Inflation

Related terms

InflationGDP deflatorSubstitution biasLaspeyres price index

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