Introduction
As seen from the table, the price deviations and inflation rates vary significantly depending on the item, season, and any global events that affect the economy. The average cumulative price change since 2000 is 76%, while the annual average inflation rate is equal to 2.52% (U.S. Bureau, 2022h).
Discussion
The prices of many daily items on the list have increased by approximately the same value. It is particularly noticeable in food pricing, where the cumulative cost of chicken has increased by 75%. However, even within the same category, there are several outliers, such as ground beef (225%) and bananas (29%). Various factors affect the prices, and it is possible to explain each of the items. For instance, there is a large surplus of bananas globally, which are typically imported from Latin American countries (Freshdelmonte, 2022). As a result, the prices for bananas do not deviate as much as for the average goods.
The opposite is true for daily items that the country lacks. For instance, the Russian-Ukraine war has significantly affected energy supplies, including gas and oil. Moreover, it affected the global supply chains that connected Russia, Europe, and the United States. As a result, the cost of electricity and gasoline has increased significantly, even considering the average inflation rate. It is a global problem, and this situation is likely to persist until the conflict is resolved or oil companies choose alternative policies. Additionally, the government can intervene in the market and implement new regulations and policies to make these daily necessities more accessible to people with average incomes.
Conclusion
Lastly, the inflation rate for electronics is not entirely accurate because the level of technological development is drastically different. It is particularly noticeable over the period of twenty-two years, and most people in 2000 could not imagine how much the technologies would develop. As a result, even though an average plasma tv cost approximately $7,500 in 2000, this price was due to limitations in manufacturing and overall knowledge of electronics. In summary, while the items on the list represent the inflation rate to an extent, it is critical to analyze each product separately to understand the causes of the price change.
Bibliography
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