Part 2: The Inflation Rate

Complete the following exercise: Visit the Bureau of Labor Statistics Web Site, http://www.bls.gov/news.release/cpi.toc.htm

(http://www.bls.gov/news.release/cpi.toc.htm). You will be using "Consumer Price Index Summary" and the "Table 1 Consumer Price Index for All Urban Consumers (CPI-U): U. S. city average, by expenditure category ".

Please note that using the data from previously published releases and summaries will produce grade zero for this part of the project.

Write a report in your own words to answer the questions:

1. What month (and year) is summarized? What was the level of the CPIU for that month? (See Table 1 "Consumer Price Index for All Urban Consumers"). What does this number represent?

2. What was the rate of inflation (percentage change in the CPIU) for the last available month? How does that rate of inflation compare with the rate in the previous month?

3.What was the rate of inflation (percentage change in the CPIU) for the last 12 months for "all items"?

4. Which two categories of goods or services had the greatest price increase for the last 12 months? Which two categories of goods or services had the lowest price increase for the last 12 months?

5. Which two categories of goods or services had the largest price decrease for the last 12 months?

6. Who loses from inflation?

7. Who benefits from inflation?

8. Please analyze and discuss the significance of the data that you received for this Data Exercise.

9. Reflect on what you have learned from this exercise.