Which of the Following Statements Is False

question 163

Multiple Choice

Which of the following statements is false?

• A) The consumer price index understates changes in the cost of living.
• B) The chain index for GDP overstates actual changes in prices.
• C) The best overall indicator of inflationary pressures in the economy is the GDP price index.
• D) One problem with any fixed- bundle index as a measure of the cost of living is that it does not account for substitutions that consumers might make in response to price changes.

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Definitions:

Great Depression

A severe worldwide economic downturn that lasted from 1929 to the late 1930s, marked by massive unemployment, bank failures, and a significant reduction in economic activity.

Wisdom

The quality of having experience, knowledge, and good judgment; the insightful understanding of what is true, right, or lasting.

Semantic

Related to meaning in language or logic.

Long-Term Memory

The phase of memory capable of storing information for extended periods, ranging from days to potentially a lifetime.