Which of the following problems in the construction of the CPI is the creation of the mobile phone most relevant to?

Question

Quizplus · Accepted Answer

The introduction of new goods is the most relevant problem that the creation of the mobile phone addresses. The CPI may not accurately reflect changes in the cost of living if it does not account for new products or technological innovations, and the mobile phone is a prime example of this. As a result, the introduction of new goods may cause the CPI to overstate inflation, making it less effective as a tool for economic analysis.

Which of the Following Problems in the Construction of the CPI