The consumer price index is the:
a. cost of a market basket of goods and services typically consumed in the base year.
b. cost of a market basket of goods and services typically consumed in the current period.
c. average of the prices of the goods and services purchased by a typical urban family of four.
d. average of the prices of new final goods and services produced in the economy over a period of time.

B. cost of a market basket of goods and services typically consumed in the current period.

B) cost of a market basket of goods and services typically consumed in the current period.

Explanation:

The consumer price index (CPI) measures the weighted average cost of a basket of goods that includes food, medical care, transportation, clothing, etc.

The Bureau of Labor Statistics (BLS) measures the CPI on a monthly basis since 1913 in urban areas around the country. For example, we are in March 2020, and the BLS already calculated that the CPI for February 2020 increased by 0.1% because food and shelter prices increased even though energy prices decreased.

The CPI is used to measure the inflation rate, but it doesn't measure the GDP's inflation, since the CPI includes imported goods. The CPI of the current year is matched against the CPI of a base year to determine accumulated inflation. Or it can be matched against the CPI of the previous year to calculate the inflation rate of the last year.