OPM selects a sufficient number of items to represent PEGs and reduce overall price index variability. In selecting these items, OPM applies the following guidelines. The item should be—
Relatively important (i.e., represent a DEC with a relatively large weight) within the PEG;
Relatively easy to find in both COLA and DC areas;
Relatively common, i.e., what people typically buy;
Relatively stable over time, e.g., not a fad item; and
Subject to similar supply and demand functions.
To the extent practical, the items OPM surveys in the COLA area must be identical to the items that OPM surveys in the DC area or be of closely similar quality and quantity, with quantity adjustments as necessary. An example of a quantity adjustment is converting prices for 10 and 12 oz. packages to a price per pound.
Within any DEC, OPM may specify items that differ in quality and quantity from other items specified for the same DEC. However, when OPM compares prices for such items between the COLA area and the DC area, OPM compares prices of like products.
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