Which of the following statements about the Wholesale Price Index are correct?
(A) It is an index of wholesale prices.
(B) In countries like the USA it is referred to as the Producer Price Index.
(C) The wholesale price is the price at which goods are traded in bulk.
(D) It is the index of prices of a basket of goods bought by the representative consumer.
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → (A), (B) and (C) only
The wholesale price is the price at which goods are traded in bulk. Its index is the WPI, called the Producer Price Index in the USA.
(A) It is an index of wholesale prices. — True. The WPI is the index for wholesale prices.
(B) In countries like the USA it is referred to as the Producer Price Index. — True. In the USA it is the Producer Price Index.
(C) The wholesale price is the price at which goods are traded in bulk. — True. Wholesale price = price for goods traded in bulk.
(D) It is the index of prices of a basket of goods bought by the representative consumer. — False. A basket bought by the representative consumer is the base of the CPI.
NCERT (2026-27): “2.4 Nominal and Real GDP It is worth noting that many commodities have two sets of prices. One is the retail price which the consumer actually pays. The other is the wholesale price, the price at which goods are traded in bulk. These two may differ in value because of the margin kept by traders. Goods which are traded in bulk (such as raw materials or semi-finished goods) are not purchased by ordinary consumers. Like CPI, the index for wholesale prices is called Wholesale Price Index (WPI). In countries like USA it is referred to as Producer Price Index (PPI). …” “2.4 Nominal and Real GDP … There is another way to measure change of prices in an economy which is known as the Consumer Price Index (CPI). This is the index of prices of a given basket of commodities which are bought by the representative consumer. …” |