Ch 8: Measurements of Inflation

About This Chapter

Earn course credit, strengthen your grades or excel on an upcoming test by studying this chapter's overview of various measurements of inflation. Review entertaining lessons and take mini quizzes any time to quickly and effectively boost your knowledge of these measurements.

Measurements of Inflation - Chapter Summary

Gain greater insight into different measurements of inflation with help from the short lessons in this chapter. Developed by top instructors, these lessons offer in-depth analyses of crude materials, the core rate of inflation, cost of living adjustments and much more. When you're ready, check your knowledge of the lessons' contents by taking multiple-choice quizzes. The Dashboard keeps track of your progress and enables you to submit lesson topic questions to our subject-matter experts. Once you've completed this chapter, you will be able to:

  • Define the consumer price index (CPI) and discuss how it measured
  • Compare and contrast the consumer price index and the GDP deflator
  • Explain how the producer price index (PPI) predicts increases in consumer prices
  • Differentiate between intermediate goods and finished goods
  • List and describe the three phases of the relationship between inflation and unemployment
  • Discuss differences between demand-pull inflation and cost-push inflation
  • Explain how fixed and adjustable rates differ as they relate to inflation over time

11 Lessons in Chapter 8: Measurements of Inflation
Test your knowledge with a 30-question chapter practice test
Consumer Price Index: Measuring the Cost of Living and Inflation

1. Consumer Price Index: Measuring the Cost of Living and Inflation

In this lesson, you'll learn what the Consumer Price Index is and how it measures changes in the level of prices in an economy. You'll also learn about the important economic concepts of inflation and deflation. Why do prices always seem to be going up?

Consumer Price Index and the Substitution Bias

2. Consumer Price Index and the Substitution Bias

In this lesson, you'll learn about the Consumer Price Index and how it is measured. You'll also learn why many economists believe that the Consumer Price Index overstates inflation.

The GDP Deflator and Consumer Price Index

3. The GDP Deflator and Consumer Price Index

Have you ever wondered how inflation is measured? This lesson will compare and contrast two of the indicators used to measure inflation - the consumer price index and the GDP deflator.

What is the Core Rate of Inflation?

4. What is the Core Rate of Inflation?

This lesson discusses the difference between core inflation and headline inflation. It also goes into detail on the different ways to measure inflation including the CPI and the PCE while relating core inflation to aggregate supply.

Producer Price Index: Definition & Formula

5. Producer Price Index: Definition & Formula

In this lesson, you will become familiar with the Producer Price Index (PPI). You will see how the PPI can predict increases in consumer prices, and learn how to calculate a basic PPI before using it to predict inflation.

Crude Materials: Definition, Categorization & Examples

6. Crude Materials: Definition, Categorization & Examples

This lesson will define crude materials. You'll also learn about the different categories of crude materials as well as numerous examples of crude materials and their eventual potential uses.

Intermediate Goods: Definition & Examples

7. Intermediate Goods: Definition & Examples

Businesses don't just sell goods. They also consume goods. In this lesson, you'll learn about intermediate goods, some related concepts, and be provided some examples.

What are Finished Goods? - Definition & Example

8. What are Finished Goods? - Definition & Example

In this lesson learn what the difference is between products that are ready for sale, known as finished goods, and products that you have bought and are using right now. You'll also see why using this term is important for businesses.

Inflation & Unemployment Relationship Phases: Phillips, Stagflation & Recovery

9. Inflation & Unemployment Relationship Phases: Phillips, Stagflation & Recovery

High inflation and unemployment are two things we don't like to see in the economy. In this lesson, you'll learn about the relationship between inflation and unemployment and three distinct phases of this relationship.

Demand-Pull Inflation vs Cost-Push Inflation

10. Demand-Pull Inflation vs Cost-Push Inflation

Discover two basic types of inflation, demand-pull and cost-push inflation. Learn what factors cause each type of inflation and some of the key differences between each.

Cost of Living Adjustment: History & Formula

11. Cost of Living Adjustment: History & Formula

In this lesson, the history and formula of the Cost of Living Adjustment is explored. You'll also learn how to apply the Cost of Living Adjustment to a Social Security benefit payment.

Chapter Practice Exam
Test your knowledge of this chapter with a 30 question practice chapter exam.
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Practice Final Exam
Test your knowledge of the entire course with a 50 question practice final exam.
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