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Eco ch 24

Measuring the cost of living

QuestionAnswer
Indexation The automatic correction by law or contract of a dollar amount for the effects of inflation
Producer price index A measure of the cost of a basket of goods bought by firms
Inflation rate The percentage change in the price index from the proceeding period
Core CPI A measure of the overall cost of consumer goods, excluding food and energy
CPI A measure of the overall cost of the goods bought by a typical consumer
Nominal interest rate The interest rate as usually reported without a correction for the effects of inflation
Real interest rate the interest rate corrected for the effects of inflation
Created by: imjeffro99
 

 



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