Final answer:
The Consumer Price Index (CPI) includes a variety of consumer goods and services in its calculation to represent the average consumer's purchases, therefore the answer is c. A variety of consumer goods and services.
Step-by-step explanation:
The Consumer Price Index (CPI) measures changes in the price level based on a fixed basket of goods and services. This basket is designed to represent the average consumer's purchases, including both consumer goods and services. Therefore, the correct answer to the student's question is c. A variety of consumer goods and services.
It's important to understand that CPI is a measure of inflation. Government statisticians at the U.S. Bureau of Labor Statistics calculate the CPI and consider changes in the cost of this fixed basket over time. Measurements of CPI take into account various factors, such as the substitution bias and quality/new goods bias, which may affect the real changes in the cost of living versus simply tracking the cost of a set basket of goods.