1. Understanding the Consumer Price Index

2. CPI- Consumer Price Index Cost of Living relative to a base period CPI is 100 in base period 1982-84 Cost of market basket of goods Urban households, other demographicregions Collected Monthly 3. Housing41.4% Transportation 17.4% Food 16.2% Energy8.2% Medical Care 6.4% Apparel and Upkeep6.1% Other 3.9% 4. Assumes market basket fixed Slow to recognize new products Hard to measure quality improvements 5. Purchasing power of your income How many market baskets can it buy? Nominal income better predictor 6. .05 Hershey bar .05 New York Times .04 First class postage stamp .31 Gallon of regular gas .28 McDonalds double hamburger $2,529 Full size Chevrolet 7. $30 in 1961$100 in 1983$212 in 2008 8. Babe Ruth (1931) $80,000 A Rod(2010) $33 million 9. Nominal wage was $1.65 hour 1952 Rose to $17 in 2007; 10x increase Real wages peaked in mid-1970s! 10. Situation - Consumers acrossNorth Dakota are being impactedby the rising price of food, gasand housing. Is oil activityimpacting prices? Will thedrought impact prices? 11. Extension Response ND Consumer Price Survey Family Economic Program Team Compare: oil impacted vs. non-oil impacted size of community type of business. 12. Small basket of food items that caneasily be found in most storesCountyExtension staff and Volunteers Gather prices at their local groceriesand supermarkets Continue through 2013 13. County Extension staff record pricesin the online survey Data and talking points provided toCounty offices each month. News releases provided ???? 14. 37 Counties Gathering PricesSeptember 2012Pembina Renville Divide BurkeRoletteBottineau Cavalier TownerWilliamsMcHenryWalshPierceMountrail RamseyWardGrandBensonForks McKenzieNelson McLean Eddie WellsFoster Griggs Steele TraillMercer Dunn BillingsOliver KidderStutsmanGoldenBurleigh Barnes CassValley MortonStark Slope HettingerLamoure Ransom Logan RichlandGrant Bowman AdamsSiouxDickeySargentMcIntosh 15. ND Counties Impacted Oil CountiesHigh Impacted Oil CountiesPembina Renville Divide BurkeRoletteBottineau Cavalier TownerWilliamsMcHenryWalshPierceMountrail RamseyWardGrandBensonForks McKenzieNelson McLean Eddie WellsFoster Griggs Steele TraillMercer Dunn Billings OliverKidderStutsmanGoldenBurleigh Barnes CassValley MortonStark Slope HettingerLamoure Ransom Logan RichlandGrantAdams Sioux McIntoshDickeySargent 16. In Sept. the high price of food package was $50.36 which is 52% higher than the lowest price of $33.09. In Oct $51.56 66% - $31.07 Theaverage cost of our package was $41.37 in September. $40.65 in Oct. 17. In Sept. the average price of package in Oil Impacted Counties was $42.24 compared to the rest of the state at $40.69. Oct. - $40.90 - $40.48 18. InSept. our smaller local grocers hadan average food package of $43.67which is just 11% higher than theaverage price of the package at a largesupermarket at $39.28. Oct. - $44.00 - 16% - $37.95 19. In Sept. 14 oz box of Cheerios sold at ahigh price of $6.99 and a low price of$2.69.The high price found at a local grocerystore and the low price at a nationalchain store. Oct. - $6.99 - $2.50 20. A gal of 2% milk in North Dakota Our highest milk price was $6.67 - $6.67 Lowest Price was $2.79 - $2.89 Average Price was $4.65 - $4.67