Is consumer price index the same as inflation?

Please help?

• indicate whether each of the following statements applies to microeconomics or macroeconomics: a)the unemployment rate in the united states was 4.2% in Jan. 01 b)the Alpo dog-food plant in Bowser, Iowa laid off 15 workers c) an unexpected freeze in central florida reduced the citrus crop and caused the price of oranges to rise d)u.S. output, adjusted for inflation, grew by 5% in 2000 e)last week Fargo Bank lowered its interest rate on business loans by one-half of 1%age point f)the consumer price index rose by 3.4% in 2000

• Answer:

  Microeconomics deals with individuals - whether consumers, firms, homogeneous groups or industries. Macroeconomics deals with the economy as a whole. a) unemployment rate is a classic macroeconomic problem since it affects or refers to the economy as a whole. b) Alpo dog-food plant is a single firm and therefore the firm's demand for labor is a microeconomics issue. c) the effect of the Florida freeze on the supply and price of one good (namely, oranges) relates to factors affecting a leftwards shift in the supply curve for oranges and therefore it is a microeconomics problem. d) 'output' is a macroeconomic aggregate since it refers to the sum total of all production in the economy. Note that the issue here is more one of output than of inflation. Real output (i.e. output adjusted for inflation) measures the growth of the economy. e) the decision made by Fargo Bank, an individual firm, is an issue in microeconomics. The interest rate is the 'price' which relates to the demand and supply of loans by this bank. f) the consumer price index measures the increase or decrease in the typical basket of goods purchased by the average consumer. It is a measure of inflation in the economy. It is a macroeconomic statistic since it doesn't relate to any one particular individual. Instead, it is derived from a sample of the total purchases of all the consumers in the economy.