Final answer:
The Consumer Price Index (CPI) is a key measure of inflation and consumer purchasing power, influencing economic decisions in the US.
Explanation:
The Consumer Price Index (CPI) is a widely used measure in the United States that tracks the average change in prices paid by consumers for goods and services. It is a key indicator of inflation and helps government, businesses, and labor forces make economic decisions.
- The CPI reflects changes in prices of goods and services typically purchased by consumers.
- It is used to assess if people's incomes are keeping up with their expenses, and it plays a role in measuring the cost of living.
- The CPI also assists in forming monetary and fiscal policies by providing crucial information about price changes in the economy.
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