CHAPTER 5 PERSONAL CONSUMPTION EXPENDITURES Form

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have you ever heard of the personal consumption expenditures pce it's an economic indicator that measures the change in the price level of consumer goods and services purchased by households but what does that actually mean the pce is a measure of inflation that is calculated by the Bureau of economic analysis and is used by the Federal Reserve to track changes in consumer spending and prices it is considered to be a more comprehensive measure of inflation than the Consumer Price Index CPI as it includes a wider range of goods and services such as rent health care and education pce is calculated by adding up all the spending by households on goods and services including durable goods such as cars and appliances non-durable Goods such as food and clothing and services such as Healthcare and education it is then compared to the same data from a previous period to determine the change in spending and prices the Federal Reserve uses the pce as one of its key indicators to determine monetar