Why Are Measurement Problems in the Consumer Price Index as an Indicator

question 160

Multiple Choice

Why are measurement problems in the consumer price index as an indicator of the cost of living important?

• A) because high rates of inflation cause voters to become unhappy
• B) because politicians have manipulated the measurement problems to their advantage
• C) because many businesses and government programs use the CPI to make adjustments to wages and benefit payments
• D) because if the price level is overstated, consumers will be taken advantage of by sellers of consumer goods

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