Th2.1: Consumer Price Index

Question 1

What does the ONS stand for?

Answer 1

Office for National Statistics

Question 2

What does the ONS do?

Answer 2

collects prices on 710 goods and services from 20,000 shops in 141 locations and online shops

Question 3

How often are new items added to or taken away from the list?

Answer 3

every year

Question 4

How are all these prices combined and why?

Answer 4

using information on the average household spending pattern to produce an overall price index

Question 5

How is the average household spending worked out?

Answer 5

through the Living Costs and Food Survey

Question 6

What do people do for the Living Costs and Food Survey and how many families do it?

Answer 6

5,500 families keep diaries of what they spend on over a fortnight

Question 7

What does the Living Costs and Food Survey do?

Answer 7

takes into account how much is spent on each item so they are weighted
e.g we spend more on petrol than stamps - an increase in petrol will have bigger impact on overall rate of inflation