Chaper 7-Index numbers Flashcards
1
Q
How do you work out index number
A
Price/Base year price x100
2
Q
What does RPI show and how often is it calculated
A
Shows rate of change (inflation/deflation) of prices of everyday goods, such as
mortgage, food and heating.
RPI is calculated monthly by comparing prices to the same month of the previous year – this is because
there can be seasonal variations.
3
Q
What does CPI show
A
Official measure of inflation used by the UK Government.
It is similar to RPI but does not include mortgage payments.
