Which of the following is true about a consumer price index?

It is used to calculate the price index of retail items.

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It is the same for everyone.

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It is used to calculate the price index of wholesale items.

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It is calculated differently for people in villages and cities.

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Solution

The correct option is D It is calculated differently for people in villages and cities.
The type of price index used to calculate the goods and services that consumers buy at the retail store like books, stationery, groceries, etc., is called the consumer price index or CPI. This will vary based on where the consumer lives, the job that they do, and what their standard of living is.

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