What is the core inflation rate and why does the fed regard it as a better measure on which to focus than the cpi? the core inflation rate is the rate of increase in the
a. gdp deflator
b. pce deflator
c. core gdp deflator
d. core pce deflator
the fed regards this as a better measure on which to focus than the cpi because
a. it includes more items than the cpi index
b. price stability is defined as an inflation rate equal to zero, which is difficult to achieve with the cpi
c. it is less volatile than the total cpi inflation rate and the fed believes that it provides a better indication of whether price stability is being achieved
d. confidence in the cpi is waning