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Why is it difficult to measure the cost of living?
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| Submitted: Wed Sep 17 2003
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Why is it difficult to measure the cost of living? Cost of living is designed to measure the costs of maintaining living standards of working- class households. It was first introduced in 1914. It is difficult to measure the cost of living because prices are constantly changing, meaning cost of products will change too. Prices will change for instance due to increases in costs or inflation, so if a can coke was $1 in 2000, due to an increase in wage demands, costs have increased and thus the selling price of coke has increased to $2 in 2001. This happens to many commodities in the market and as a result of that it is difficult to measure the price of products as that are constantly changing over a period of time. The quality of products also changes, however this will appear on the cost of living index. For instance computers, CD...
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