An example of the outlet substitution bias in the calculation of the CPI is a price increase in

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The outlet substitution bias occurs when consumers switch from buying a good at a store that has increased its price to buying the same good at a store with lower prices. In this case, buying textbooks through the campus bookstore versus via Craigslist allows for a direct comparison of prices, and consumers can easily switch to the cheaper option. The other examples involve differences in products or locations, which do not represent outlet substitution.

An Example of the Outlet Substitution Bias in the Calculation