In economics a customer basket, market basket or commodity basket is a set of different amounts of different goods and possible services. The commodity basket will contain goods and services a typical consumer will likely need. Commodity baskets can be used for two things: First, the price level of two economies can be compared. Secondly, using the same basket, it is possible to show how prices change over time. The amount of money needed to buy everything in the basket, over time, is called consumer price index.
Market basket | set of different amounts of different goods and possible services
Questions and Answers
Q: What is a customer basket?
A: A customer basket, also known as a market basket or commodity basket, is a set of different amounts of goods and services that a typical consumer would need.
Q: What are the two main uses for commodity baskets?
A: The two main uses for commodity baskets are to compare the price level of two economies and to show how prices change over time.
Q: What is consumer price index?
A: Consumer price index is the amount of money needed to buy everything in the basket over time.
Q: How can commodity baskets be used to compare two economies?
A: Commodity baskets can be used to compare two economies by looking at the different amounts of goods and services they contain and their respective prices.
Q: How do commodity baskets show how prices change over time?
A: Commodity baskets show how prices change over time by comparing the amount of money needed to buy everything in the basket at different points in time.
Q: Are market baskets and commodity baskets interchangeable terms?
A: Yes, market baskets and commodity baskets are interchangeable terms that refer to sets of different amounts of goods and services that a typical consumer would need.