Which term refers to the price index that reflects the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services?

The term that refers to the price index reflecting the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services is the Consumer Price Index. This index is crucial in measuring inflation and deflation within an economy, providing insights into the cost of living for consumers. It tracks changes in prices for a wide range of items, such as food, clothing, housing, and transportation, which are common in the daily expenditures of households.

By examining the changes in this price index over time, economists and policymakers can make informed decisions regarding monetary policy, wage adjustments, and other economic indicators. The Consumer Price Index serves as a vital tool for understanding how inflation affects purchasing power and overall economic health.