Mortuary Science Practice Exam

What does the Detroit Consumer Price Index measure?

1. The unemployment rate in Detroit

2. The index for urban wage earners in the area

3. The cost of living in Detroit

4. The number of businesses in Detroit

The correct answer is: The index for urban wage earners in the area

The Detroit Consumer Price Index primarily measures the cost of living in Detroit by tracking the change in prices of a basket of goods and services commonly purchased by households in the area. This index reflects the overall economic conditions affecting consumers, including inflation and purchasing power. Understanding the Consumer Price Index is crucial for analyzing economic trends, wages, and living conditions, thereby influencing financial decisions and policies in the region. The focus on the cost of living aligns with how the index provides insights into consumer spending patterns and the general economic well-being of residents. The other options, while related to economic aspects of the city, do not accurately define the specific function of the Consumer Price Index.