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Consumer Price Index CPI

Economy Term

The Consumer Price Index (CPI) is a measure of the average change in prices over time of goods and services purchased by households.

The CPIs are based on prices of food, clothing, shelter, and fuels, transportation fares, charges for doctors' and dentists' services, drugs, and other goods and services that people buy for day-to-day living.

Prices are collected each month in 87 urban areas across the country from about 4,000 housing units and approximately 25,000 retail establishments-department stores, supermarkets, hospitals, filling stations, and other types of stores and service establishments.

All taxes directly associated with the purchase and use of items are included in the index. Prices of fuels and a few other items are obtained every month in all 87 locations. Prices of most other commodities and services are collected every month in the three largest geographic areas and every other month in other areas.

Prices of most goods and services are obtained by personal visits or telephone calls of the Bureau's trained representatives. In calculating the index, price changes for the various items in each location are averaged together with weights, which represent their importance in the spending of the appropriate population group. Local data are then combined to obtain a U.S. city average.



   
     
Related Economy Terms
                     
                     
 Advance monthly sales   CE-marked   Durable Goods  
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 Agents and Brokers   Civilian labor force   Employer Identification Number  
 ARPU   Constant Currency   Employment population ratio  
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 Balance on current account   Corporate Integrity Agreement   Euro Zone  
 Balance on goods and services   Deflation   European Monetary Union  
 Bonded Warehouses Manufacturing   Direct investment   Executive Management  
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 Business sector   Drop Ship Retail   Factory Inventories  
               
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