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Because the CPI Overstates Inflation

Question 129

Multiple Choice

Because the CPI overstates inflation,


A) when wages are linked to the CPI,workers' wages become too low as time passes.
B) as time passes,government payments are increasingly lower than intended.
C) as time passes,government outlays are increased by more than necessary to compensate for inflation.
D) workers do not receive adequate compensation for price changes.
E) most contracts use the GDP deflator to measure inflation.

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