Explain the major difference between the CPI and the PCE deflator. Why does the Federal Reserve prefer

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Explain the major difference between the CPI and the PCE deflator. Why does the Federal Reserve prefer to use the core PCE to measure the inflation rate?

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Macroeconomics

ISBN: 9780132109994

1st Edition

Authors: Glenn Hubbard, Anthony Patrick O'Brien, Matthew P Rafferty

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Question Posted: Feb 04, 2016 06:36 AM

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Explain the major difference between the CPI and the PCE deflator. Why does the Federal Reserve prefer

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The difference between the CPI and PCE is that the CPI tracks the relative ...View the full answer

Macroeconomics

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