RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:Cad : USD TheCount11 wrote: "The price per transaction is manipulated by the inflation rate so we hold it constant."
What are you holding constanst?
Obviously it can't be inflation or the price per transaction.
Both change over time.
The product mix changes. I'm holding the transactional basket constant. I.e, a company only sells one product, let's call it a dress. The number of dresses they sell is the quantity of dresses and the price of the dress fluctuates with the inflation rate. Obviously, in the real world a company's product mix changes over time. The same thing occurs when a company's inventory jumps from quarter to quarter on the balance sheet. Inventory may rise because the "average" price per unit has increased and not necessarily because they purchased more "stuff".