2.6 Producer price index
The Producer Price Index, or the PPI, stands for "family of indexes that measures the average change in selling prices received by domestic producers of goods and services over time. PPIs measure price change from the perspective of the seller" (Investopedia, 2009). The evolution of the PPI has also been a fluctuating one, with a major ascendant trend:
Source: United States Department of Labor, 2009
Despite the past increase in producer price index, the future seems to hold decreases in its value:
The downward trend forecasted for the following 18 months means that the automobile producers in the United States receive less money for the sale of their products. Increases in this value lead to growths in the revenues of the vehicle producers, but a most compelling conclusion can only be drawn through correlation with the inflation rate throughout the studied period. For instance, if the inflation and the PPI grow at similar rates, the automobile manufacturers have not gained any real advantage.
References:
Ford Motor Company, Hoovers, 2009, http://hoovers.com/ford-motor/--ID__10597,FRIC__ -- /free-co-competition.xhtml...
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