The Superposition of Markov Chain and the Prediction of Consumer Price Index

  IJMTT-book-cover
 
International Journal of Mathematics Trends and Technology (IJMTT)
 
© 2017 by IJMTT Journal
Volume-49 Number-5
Year of Publication : 2017
Authors : Han Song, Liu Na
  10.14445/22315373/IJMTT-V49P541

MLA

Han Song, Liu Na "The Superposition of Markov Chain and the Prediction of Consumer Price Index", International Journal of Mathematics Trends and Technology (IJMTT). V49(5):267-273 September 2017. ISSN:2231-5373. www.ijmttjournal.org. Published by Seventh Sense Research Group.

Abstract
Using China's consumer price index historical data and the methods of Superimposed Markov chain to forecast the CPI of the year 2016 is a new channel in the CPI forecast. Firstly ,according to the relationship between China's consumer price index and inflation, divided the CPI into five states ; Secondly, using C-K methods to compute the order transition probability matrix; Thirdly, according to the CPI of 2009-2013 to forecast the situation of 2014,the CPI of 2010-2014 to forecast the situation of 2015;Forthly, compared with the actual situation, it is confirmed that the method of basing on the superposition of markov chain to forecast consumer price index is accurate. Finally, using the data from 2011-2015 to forecast CPI this year to provide theoretical basis for the government's macroeconomic regulation and the policymaking.

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Keywords
Consumer Price Index; markov chain; inflation Introduction.