In India, inflation is measured by the:
✓ Correct answer: a) Wholesale Price Index number
ExplanationIn India, inflation has traditionally been measured us- ing the Wholesale Price Index (WPI) and stands true for 1997. The WPI tracks the price changes of goods at the wholesale level, reflecting the prices at which goods are sold in bulk and is pub- lished by the Economic Adviser in the Ministry of Commerce and Industry.However, in recent years, the Consumer Price Index (CPI) has gained prominence as a measure of inflation, especially for policy decisions.The CPI measures price changes from the consumer’s perspective, capturing the retail prices of goods and services.The Reserve Bank of India (RBI) has adopted the CPI as the key mea- sure for its inflation targeting framework.6. MONEY MARKET 123
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