Consumer Price Index (CPI) - InvestingAnswers
Nov 2, 2020 · The consumer price index measures the monthly change in the retail prices of approximately 80,000 specific goods and services, called the market basket. The goods and services fall into eight major categories: food and beverage, housing, apparel, transportation, medical care, recreation, education and communication, and other.
Producer Price Index -- Definition & Example - InvestingAnswers
Aug 20, 2020 · The producer price index consists of a weighted index of goods prices at wholesale. PPI is divided into three levels. The first is the PPI commodity Index, which shows the average price change over a certain time period (usually a month) for commodities like crude oil and coal. The second level is the PPI stage of processing (SOP), which ...
Inflation Definition & Example - InvestingAnswers
Apr 27, 2021 · For example, let's assume that you invest $1,000 in a one-year XYZ Company bond. If the bond yields 5%, then at the end of the year you will collect $1,050. Your 5% return may not be as good as it looks if the inflation rate was 4% during the year. Your real return is actually 1%. Some securities, such as Treasury Inflation-Protected Securities ...
Price Inflation Definition & Example - InvestingAnswers
Oct 1, 2019 · The CPI measures the change in the retail prices of approximately 80,000 specific goods and services, called the market basket. An example of price inflation for a specific good could be a 4.4-pound bag of 'extra-fancy' Golden Delicious apples that represents the 'apples' category. If the price of the apples was $2 in May and $2.25 in June, we ...
CCI -- Consumer Confidence Index -- Definition & Example
Oct 1, 2019 · The average value of all five survey sections determines the overall Consumer Confidence Index. The Conference Board releases the survey results at 10 a.m. on the last Tuesday of every month. Most analysts warn against putting too much weight on month-to-month changes in CCI and instead focus on longer-term trends.
Treasury Inflation-Protected Securities (TIPS) - InvestingAnswers
Oct 7, 2020 · For example, if a traditional 10-year Treasury bond 's current yield is 5% and a 10-year TIPS' current yield is 4%, the TIPS may provide a higher return than the traditional bond if the CPI increases by, say, 3% over the life of the bond. This is because 3% of the traditional Treasury bond's 5% return is eaten away by inflation, leaving a 'real ...
Index Definition & Example - InvestingAnswers
Apr 27, 2021 · Total $55. To create an index, we simply set the total ($55) in the year 2000 equal to 100 and measure any future periods against that total. For example, let's assume that in 2001 the stock prices were: Total $78. Because $78 is 41.82% higher than the 2000 base, the index is now at 141.82. Every day, month, year, or other period, the index can ...
Stock Market Index Definition & Example - InvestingAnswers
Apr 27, 2021 · In the year 2018, the four companies' stock prices were as follows: To create an index, we simply set the total ($55) in the year 2018 equal to 100 and measure any future periods against that total. For example, let's assume that in 2019 the stock prices were: Because $78 is 41.82% higher than the 2018 base, the index is now at 141.82.
Gold Bug Definition & Example - InvestingAnswers
Oct 16, 2020 · Why Does a Gold Bug Matter? Throughout history, gold has traditionally risen in value when things like wars, the Great Depression, or high inflation have occurred. For example, from 1970 to 1975, the price of gold rose 375% as the Consumer Price Index (CPI) posted double-digit increases. When Standard & Poor's (S&P) downgraded U.S. Treasury ...
Price Sensitivity Definition & Example - InvestingAnswers
Oct 1, 2019 · In consumer behavior, price sensitivity (also called the elasticity of demand) is the degree to which price affects the sales of a product or service. Thus, the formula for price sensitivity is: Price Sensitivity = % Change in Quantity Purchased/% Change in Price. In the bond world, duration is a measure of a bond’s price sensitivity to ...