Question

Q. In which of the following aspects, the Wholesale Price Index (WPI) and Consumer Price Index (CPI) differ from each other?

Select the correct answer using the code given below:

• A.
  2, 3 and 4 only
• B.
  1, 3 and 4 only
• C.
  1 and 2 only
• D.
  1, 2, 3 and 4

Answer 1

The correct option is D

1, 2, 3 and 4
Explanation:

Wholesale Price Index (WPI) is the price of a representative basket of wholesale goods i.e. it is calculated at the level of the manufacturers and wholesalers.

The Consumer Price Index (CPI) indicates the average change in the prices of commodities at the retail level i.e. it is calculated at the level of consumers.

The CPI is used by the Government for calculating the Dearness Allowance (DA).

Statement 1 is correct: The base year of WPI is 2011-12 and the base year for CPI is 2012.

Statement 2 is correct: While WPI is released by the Office of Economic Advisor under the Ministry of Commerce & Industry, the Central Statistics Office under the Ministry of Statistics and Programme Implementation releases the CPI.

Statement 3 is correct: Only goods are covered under the WPI, while both the goods and services are covered by the CPI.

Statement 4 is correct: While WPI covers 697 (Primary, fuel & power and manufactured products) items, 448 in CPI (Rural Basket) and 460 in CPI (Urban Basket) items are covered.