GDP and the CPI : tracking the Macroeconomy

4 important questions on GDP and the CPI : tracking the Macroeconomy

When is real GDP per capita useful?

When comparing labor productivity between countries.

Why GDP per capita is not a sufficient measurement of well-being?

Real GDP measures the expansion in the economic production
which only increases society's income, but it does not tell whether society actually makes good use of it.

Eample of
1. How to constract the CPI
2. How to calculate inflation rate

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How to construct  CPI In an alternative way?

Step 1: the goal is to find CPI per Item( individually)  so..
            year 2  CPI per item = year 2 price per item/year price iteam
             * 100

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