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In Constructing the CPI,the ABS Has to Deal with Commodity

Question 80

Multiple Choice

In constructing the CPI,the ABS has to deal with commodity substitution bias,which is defined as


A) consumers' substitution of cheaper goods for goods whose prices increase.
B) the bias from new goods being introduced that are more expensive than older goods.
C) the bias that arises because the ABS changes the CPI market basket each month.
D) consumers' substitution of discount stores for full service stores to avoid the higher prices in the full service stores.
E) the bias from quality changes in existing products that cause prices to increase.

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