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What is Consumer Price Index
CPI is a price index of a specific basket known as the CPI-basket. CPI-basket contains essentially all the service and goods consumed in a country - food, medicine, gas, haircuts, house rent, transportation and so on. Composition of the CPI basket is concluded by value of what is consumed in country - the larger the value of total consumption of a service or good, the larger the weight in basket.
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Aggregate Consumption This is the aggregate of all expenditures on current consumption goods and services i.e. those which are consumed during the period. Living standards are
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what wil hapen to the real wage if the nominal wages and prices rise at the same rate per year?
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