Consumer Price Index (CPI)

Definition

Consumer Price Index (CPI) measures the change in the general level of prices of a fixed basket of goods and services consumed by households over time. It is used to measure inflation and changes in the cost of living.

Formula

CPI = ( Cost of Fixed Basket in Current Year ÷ Cost of Fixed Basket in Base Year ) × 100

CPI is generally calculated using the Laspeyres method (base-period quantities as weights).

Calculator (Simplified – Single Basket)