The Consumer Price Index, which is the measure of inflation, is based upon a “market basket” of goods which can be changed at any time to suit the narrative. Actually inflation may be currently running closer to 18% by my estimation.
Yes and you must take into account horizontal substitution. Steak may go from $7 / lb to $15 / lb. But if you the consumer give up your $7/lb steak and start buying $3 /lb hot dogs that is deflationary not inflationary even if you did it because you had not choice after your daughters dental price for braces went up.
US used to use a cost of goods index which was based on the cost of a set basket of goods. Of course that makes the politicians look bad so it was changed.
If you didn’t buy steaks for July 4th and got a bag of generic hotdogs instead, you saved 16 cents... YAY BRANDON!!!