Collecting Data for Consumer Price Index Number

Consumer Price Index (CPI) is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services. To determine the CPI, we need to collect data on prices of various goods and services. The data collection can be done through various sources, but the most appropriate source is retail shop prices. Let's discuss why:

Retail Shop Prices

Retail shops are where consumers buy goods and services for personal use. The retail prices are the final prices that consumers pay for the goods and services. Therefore, collecting data from retail shops gives us the most accurate picture of the prices paid by consumers for the products and services included in the CPI.

Wholesale Shop Prices

Wholesale shops are where retailers buy goods and services in bulk. The wholesale prices are lower than the retail prices as retailers add their profit margin on top of the wholesale price. Therefore, collecting data from wholesale shops would not give us an accurate picture of the prices paid by consumers.

Fair Prices

Fair prices are prices set by the government to ensure that consumers are not overcharged for essential goods and services. Collecting data from fair prices may not be appropriate as these prices are not reflective of the market prices paid by consumers.

Government Depots

Government depots are where the government stores goods that are sold to consumers at subsidized prices. Collecting data from government depots may not be appropriate as these prices are not reflective of the market prices paid by consumers.

Conclusion

In conclusion, to determine the CPI, collecting data from retail shop prices is the most appropriate source. These prices are the final prices paid by consumers for the goods and services included in the CPI. Collecting data from other sources may not give us an accurate picture of the prices paid by consumers for the goods and services included in the CPI.

As retail shop prices are charged to consumers and consumer will purchase at retailers rates.