The bias in the CPI typically
A)understates inflation.
B)overstates inflation.
C)about half the time overstates and about half the time understates the inflation rate.
D)cannot be measured or estimated.

Question

Quizplus · Accepted Answer

The Consumer Price Index (CPI) often overstates inflation due to factors like substitution bias, quality improvements, and new product introductions not being fully accounted for.

The Bias in the CPI Typically