The term CPI most commonly refers to the Consumer Price Index, a key economic indicator used to measure inflation. In project management, it can also stand for the Cost Performance Index. 1. Consumer Price Index (Economics) The Consumer Price Index tracks the average change over time in the prices paid by consumers for a "market basket" of goods and services. How it Works: Statistical agencies (like the U.S. Bureau of Labor Statistics) collect thousands of prices monthly for items such as food, housing, clothing, transportation, and medical care.What it Tells Us:Inflation/Deflation: A rising CPI indicates inflation (prices are going up), while a falling CPI indicates deflation.Purchasing Power: As the CPI rises, the purchasing power of your money declines because each unit of currency buys fewer goods.Policy Impact: Central banks, such as the Federal Reserve, use CPI data to decide whether to adjust interest rates to stabilize the economy.Key Variations:Headline CPI: Includes all items in the basket, including volatile food and energy prices.Core CPI: Excludes food and energy to provide a clearer view of long-term price trends. 2. Cost Performance Index (Project Management) In the context of project management, CPI measures the financial effectiveness and efficiency of a project. Formula: \(\text{CPI}=\frac{\text{Earned\ Value\ (EV)}}{\text{Actual\ Cost\ (AC)}}\).Interpretation:CPI > 1: The project is under budget (performing well).CPI = 1: The project is exactly on budget.CPI < 1: The project is over budget. 3. Other Meanings Cost Per Install (Marketing): A metric used by advertisers to track the cost of each new mobile app installation.