Inflation is a measure of how prices have changed over time, with inflation meaning each dollar spent buys less. The document directs the reader to a Bureau of Labor Statistics website to answer questions about inflation rates, consumer spending, and their implications for economic policy as measured by the Consumer Price Index, Producer Price Index, and Consumer Expenditure Survey since 2000.

1. Inflation is a measure of how prices have changed over time. If
prices are changing due to inflation, each dollar spent will buy
less.
In order to answer the questions below, go to the following
website:
http://www.bls.gov/cpi/
Questions:
What is inflation? What are the causes of inflation? Is
inflation desirable and what can be done to control inflation in a
market economy?
What is the Consumer Price Index (CPI)? How has the CPI
behaved since the year 2000? What have been the causes of
these changes? In your response, include a graph of the CPI for
this period and cite your source.
What is the Producer Price Index (PPI)? How has the PPI
behaved since the year 2000? What have been the causes of
these changes? In your response, include a graph of the PPI for
this period and cite your source.
What is the Consumer Expenditure Survey (CE)? How has the
Survey behaved since the year 2000? What have been the
causes of these changes? In your response, include a graph of
the CE for this period and cite your source.
What do the measures above tell us about consumer behavior?
Have incomes changed enough to offset the inflation since
2000? What can we predict about future inflation?
What are the implications of these measures for government
economic policies?