If you haven’t read parts 1-4 of this series, you will probably want to do that before reading this installment on understanding inflation.
Hedonic Adjustments: Even though the price went up $2,000, the car still costs the same … what???
Since 1999, the CPI index has been adjusted using hedonics, which is a price adjustment for quality. [...]
If you haven’t read parts one, two and three of this series on inflation, you might want to read those first.
The 1999 Switch to a New Formula
In 1999 the weight given to items in the CPI index was changed from straight arithmetic to geometric weighting. Instead of straight math, the new formula puts more weight [...]
If you haven’t read parts one and two of this series, you might want to go back and read those before you read part 3.
As we have discussed in the previous segments of this series, the CPI index is a measure of inflation. Now I will address how I think the way CPI is calculated [...]
In this 6-part series, I am going to attempt to explain something that affects all of us but something that few of us understand — inflation. If you stick with me through this series, you will find out why I think that the way inflation is calculated contributed to — or perhaps caused — the [...]
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