Which statement about chained consumer price index for urban consumers (C-CPI-U) is TRUE?
A) It does a better job in approximating a cost-of-living index than the CPI.
B) It takes less time to estimate than the CPI.
C) It is generally higher than the CPI.
D) It has no advantage over the CPI.

Question

Quizplus · Accepted Answer

The chained CPI-U accounts for changes in consumer behavior and substitution between goods, making it a better approximation of a cost-of-living index compared to the traditional CPI.

Which Statement About Chained Consumer Price Index for Urban Consumers