Which of the Following Exemplifies the Outlet Bias in the Computation

question 107

Multiple Choice

Which of the following exemplifies the outlet bias in the computation of the CPI?

• A) Roxanna refuses to shop at factory outlet stores because she says that the layouts of the stores are too chaotic and therefore is too time-consuming.
• B) Yu-Jen does most of her shopping at Costco instead of Safeway because the prices at Costco are more competitive.
• C) Katie prefers to buy her groceries at Whole Foods because they carry a wide selection of organic produce.
• D) Diana does her holiday shopping at Metro-Foods because she values their excellent customer service.

---

Definitions:

Truth-in-Lending Act

A U.S. federal law designed to promote the informed use of consumer credit by requiring disclosures about its terms and cost.

Deferred Payment Plan

A payment arrangement that allows a purchaser to pay for goods or services at a later date, often after receiving some form of benefit from them.

Retroactive APR

Annual Percentage Rate that is applied to charges made previously, often after a promotional period ends or due to a late payment.

Monthly Periodic Rate

The APR divided by 12; the rate of interest charged each month.