Consider the following statements:
1. The weightage of food in Consumer Price Index (CPI) is higher than that Wholesale
Price Index (WPI).
2. The WPI does not capture changes in the prices of services, which CPI does.
3. Reserve Bank of India has now adopted WPI as its key measure of inflation and to
decide on changing the key policy rates.
Which of the statements given above is/are correct?
The weightage of food in Consumer Price Index (CPI) (around 46%) is higher than that in Wholesale Price Index (WPI) (around 26%) Wholesale Price Index, or WPI, measures the changes in the prices of goods sold and traded in bulk by wholesale businesses to other businesses. WPI is unlike the Consumer Price Index (CPI), which tracks the prices of goods and services purchased by consumers. RBI adopted CPI as the key measure of Inflation. Hence Statement 3 is incorrectTherefore, the correct answer is (a).