Which of the following is NOT included in the core Consumer Price Index (CPI)?
A. Food
B. Healthcare
C. Education
D. Transportation
Answer (1)
The correct answer is letter A. FoodCore CPI excludes food and energy prices because they are very volatile—meaning their prices can change a lot due to factors like weather, oil supply shocks, or natural disasters. By removing them, economists can get a clearer picture of long-term price trends without being distracted by temporary price spikes.In the Philippines, the price of food—especially rice, onions, or sugar—can rise quickly due to typhoons or shortages. If we only used headline CPI (which includes food), it might give the impression that inflation is high, even if prices for other items like clothing or rent stayed stable. Core CPI helps the Bangko Sentral make better decisions on interest rates by focusing on broader price trends.
