The consumer price index is one of the ways to measure the average price level, which is calculated for many items of goods and services and, according to some researchers, is the best indicator of the cost of living.
Instructions
Step 1
The consumer price index calculates the change in prices for goods and services included in the consumer basket. In Russia, the consumer basket was approved on March 31, 2006 by Federal Law No. 44-FZ “On the Consumer Basket in the Russian Federation as a whole”. It includes three groups of goods and services:
• Food products (bread products, potatoes, vegetables, etc.);
• Non-food items (clothing, medicines, household goods, etc.);
• Services (utilities, transport and others).
Step 2
To calculate the consumer price index yourself, you need a complete list of the goods and services included in the basket, their base year price and current market value. The consumer price index formula is as follows: CPI =? (C (t)? T (b)) /? (C (b)? T (b)), where C (t) and C (b) are the price level, respectively, of the current and base years for products and services of the consumer basket;
T (b) - a list of goods and services of the consumer basket. To calculate inflation, the fraction is multiplied by 100 percent.
Step 3
Similarly, you can calculate the consumer price index and inflation based on your own consumer basket. To do this, draw up a complete list of products and services that are priority for you and that you constantly use. Write down their current prices. For personal use, you can calculate the CPI on a monthly basis. Some people use the described method to calculate the so-called real inflation, which, as a rule, does not coincide with the officially approved inflation rate. However, there is nothing surprising in this. It has long been noted that inflation is always higher in the group of inexpensive goods that are used by the majority of the population.
