The term 'Core Inflation' is useful for policy makers because it:
A. Measures only food inflation
B. Includes all volatile items
C. Excludes food and fuel prices to reveal underlying inflation trends
D. Is always higher than headline inflation
Answer: Option C
Solution (By JKSSB Mock Tests)
Core inflation excludes volatile components such as food and energy, providing a clearer picture of persistent inflationary pressures for monetary policy decisions.
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