Which of the following is NOT a source of bias in the CPI?
I.quality change bias
Ii.new goods bias
Iii.quantity change bias

Question

Quizplus · Accepted Answer

The quantity change bias and new goods bias are sources of bias in the CPI, but quality change bias is not. Quality change bias refers to the fact that improvements in the quality of goods and services are not always adequately measured and accounted for in the CPI. This can lead to an overstatement of inflation if the quality improvements are not reflected in the price. However, this does not involve any sort of bias, but rather a measurement issue.

Which of the Following Is NOT a Source of Bias