What does the Consumer Price Index (CPI) measure?

The Consumer Price Index (CPI) is a widely used economic indicator that measures the average change over time in the prices paid by consumers for a basket of goods and services. As such, it serves as an important tool for assessing the level of inflation in an economy. By tracking the changes in the prices of these goods and services, the CPI allows economists and policymakers to understand how the purchasing power of money is changing. An increase in CPI indicates rising inflation, while a decrease can suggest deflation or a stabilization of prices.

In contrast, the other options relate to different economic activities. The rate of property sales pertains to real estate market performance; average property values focus specifically on real estate valuations; and the rate of tax collection relates to government revenue rather than consumer spending. Thus, while these concepts are important in their own contexts, they do not align with the specific function of the CPI.