1. Def
   1. an index drawn up by the central statistics office to measure the changes in the general level of prices over a period of time
   2. Price Index
      1. table form
      2. changes in price
      3. period of time
   3. Simple price index
      1. change in price
      2. one product only
   4. Composite Price Index
      1. change in price
      2. Number of goods
2. Uses
   1. Measure inflation
   2. Increases
      1. wages
      2. social welfare benefits
   3. economic indicators
   4. Price competitveness
   5. Indexation of Interest Rates
3. Limitations
   1. Limited products
   2. no new products
   3. Overstates cost of living
   4. average household
   5. Changes in quality of goods
   6. differences
      1. urban
      2. rural
   7. Increased indirect taxes
4. Constant Price Index
   1. def
      1. omits price increases due to indirect tax
   2. For
      1. Extra services are given
      2. Higher standard of living
   3. Against
      1. not all benefit
5. Consumer Price Index