How is Wholesale Price Index different from Consumer Price Index?

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Solution

Instructions
Mention what kind of items are included in WPI and CPI and their utility.

Answer:

The WPI includes all goods- capital goods and consumer goods and changes in their wholesale rates, the CPI measures only changes in prices of a few selected consumer goods at the retail price.

While inflation is generally measured considering the changes in the WPI, the government uses CPI to calculate the revised wage rates for the government employees.

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Similar questions

Q. Explain Consumer Price Index and Wholesale Price Index , also write their formulae.

In general, inflation is calculated by using

(i) wholesale price index

(ii) consumer price index

(iii) producer's price index

A consumer price index measures changes in

(i) retail prices

(ii) wholesale prices

(iii) producers prices

From an individual perspective, which index between Consumer Price Index(CPI) and Wholesale Price Index (WPI) would affect your standard of living more? Give reason.

The consumer price index in India is continuously rising over the year 2012 and 2013. Which value is compromised with the rising wholesale price index?

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