Doubt Clearance Thread: UPSC 2021
"When in doubt, observe and ask questions. When certain, observe at length and ask many more questions."
Created this thread as a one stop solution for all members so that all the doubts wherein any conceptual clarification is required can be solved here.
avenger99,@prelims2020 All inflations are measured on basis of a set basket of goods.In simple wordsCPI inflation just measures the inflation rate of consumer price goods. How much extra you have to spend to buy the same goods you purchased last year.Retail inflation does the same thing except it also takes rent, interest rates,mortgage student loans housing etc etc into consideration thus giving a clear picture.Mostly RPI will be higher than CPI :)
Are you sure? Is this definition of Retail inflation provided for by RBI?
As per my understanding - CPI tracks the change in retail prices of goods and services which households purchase for their daily consumption. So it should be the same thing, I think
avenger99,@prelims2020 All inflations are measured on basis of a set basket of goods.In simple wordsCPI inflation just measures the inflation rate of consumer price goods. How much extra you have to spend to buy the same goods you purchased last year.Retail inflation does the same thing except it also takes rent, interest rates,mortgage student loans housing etc etc into consideration thus giving a clear picture.Mostly RPI will be higher than CPI :)
As per this article, Consumer Price Index or CPI as it is commonly called is an index measuring retail inflation in the economy by collecting the change in prices of most common goods and services.
https://www.investopedia.com/terms/r/rpi.asp
That article which you mentioned, says that CPI measures the retail inflation. However, the article mentions the term ‘retail’ because it’s most widely used term when we define CPI. In other words, WPI measures wholesale goods and CPI measures retail inflation. That is because WPI and CPI are most widely used indexes.
However, RPI and CPI are only different when it comes to what ‘basket of goods’ consist of. CPI doesn’t include cost of housing (cost of housing is different from housing as it consists of mortgage and interest rates) while RPI does. :)
PS:
I read the OPs question again,
CPI measures retail inflation. Retail inflation and CPI are used interchangeably. However, RPI and CPI are not. :)
@upsc2020 Hi, I don’t know RBI definition, but this is what the term generally means :) Yes, you are right RPI like CPI is based on a set basket of goods. But the difference between 2 arises when you define what that set of basket of goods comprises of.Here is a more clear explanation:https://www.investopedia.com/terms/r/rpi.asp
That article which you mentioned, says that CPI measures the retail inflation. However, the article mentions the term ‘retail’ because it’s most widely used term when we define CPI. In other words, WPI measures wholesale goods and CPI measures retail inflation. That is because WPI and CPI are most widely used indexes.
However, RPI and CPI are only different when it comes to what ‘basket of goods’ consist of. CPI doesn’t include cost of housing (cost of housing is different from housing as it consists of mortgage and interest rates) while RPI does. :)
PS:
I read the OPs question again,
CPI measures retail inflation. Retail inflation and CPI are used interchangeably. However, RPI and CPI are not. :)
That's interesting. Thanks !!
avenger99,GreenArrow@upsc2020 Hi, I don’t know RBI definition, but this is what the term generally means :) Yes, you are right RPI like CPI is based on a set basket of goods. But the difference between 2 arises when you define what that set of basket of goods comprises of.Here is a more clear explanation:https://www.investopedia.com/terms/r/rpi.asp
That article which you mentioned, says that CPI measures the retail inflation. However, the article mentions the term ‘retail’ because it’s most widely used term when we define CPI. In other words, WPI measures wholesale goods and CPI measures retail inflation. That is because WPI and CPI are most widely used indexes.
However, RPI and CPI are only different when it comes to what ‘basket of goods’ consist of. CPI doesn’t include cost of housing (cost of housing is different from housing as it consists of mortgage and interest rates) while RPI does. :)
PS:
I read the OPs question again,
CPI measures retail inflation. Retail inflation and CPI are used interchangeably. However, RPI and CPI are not. :)
Thank you...Very well explained
avenger99,GreenArrow
question 27 answer .
The special committee to examine the draft constitution was headed by jawahral nehru ?
but it given that this committee chiarmen was dr, rajendra prasad
This committee was headed by Alladi Krishnaswamy Ayar. Not Prasad or Nehru.
No it was headed by nehru
Check page 2.4 in laxmikanth
GreenArrow,
question 27 answer .
The special committee to examine the draft constitution was headed by jawahral nehru ?
but it given that this committee chiarmen was dr, rajendra prasad
This committee was headed by Alladi Krishnaswamy Ayar. Not Prasad or Nehru.
No it was headed by nehru
Check page 2.4 in laxmikanth
only in laxmikant it given that this committe is by nehru all other sources said that either rajendra pasad or alladi ayyer
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