The Tale of Two Indexes: CPI and WPI
In the bustling kingdom of Econland , two powerful advisors helped the king track the rising and falling costs of goods: Sir CPI (Consumer Price Index) and Lord WPI (Wholesale Price Index) . The king, worried about inflation affecting his subjects and traders, often turned to these two advisors to understand the kingdom’s economy. However, while both measured inflation, their approaches were vastly different. Chapter 1: The People's Guardian – Sir CPI Sir CPI was tasked with keeping an eye on the common people —the farmers, merchants, blacksmiths, and tailors—who bought goods for daily use. He rode through the streets, visiting homes, markets, and shops, tracking the prices of essential goods and services that people used every day: ✅ Food & Beverages – Fruits, vegetables, milk, bread ✅ Housing – Rent for homes ✅ Clothing & Footwear – Woolen coats, silk robes ✅ Healthcare – Medicines, doctor visits ✅ Transportation – Carriages, horses, oil for lamps Formula for CPI: ...