[Solved] Which of the following is TRUE about the difference between headline inflation and core inflation? — Ans: Core inflation excludes volatile items like food and fuel, headline inflation... | Economic Awareness

Economic Awareness - Sectors of Indian Economy

Which of the following is TRUE about the difference between headline inflation and core inflation?

ACore inflation excludes volatile items like food and fuel, headline inflation includes all items

BHeadline inflation excludes food and fuel prices, core inflation includes them

CBoth headline and core inflation exclude energy prices

DCore inflation is always higher than headline inflation

Step-by-Step Solution

Step 1: Understand headline vs core inflation
Headline inflation includes all items; core inflation excludes volatile items like food and fuel.
Step 2: Evaluate the statements
Only the statement that core inflation excludes volatile items and headline includes all is correct.
Final Answer:
Core inflation excludes volatile items like food and fuel, headline inflation includes all items → Option A
Quick Check:
Headline vs core inflation = core excludes volatile items ✅

Quick Trick: Headline = all items; core = excludes volatile items.

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