Which of the Following Is NOT a Consequence of the CPI

question 5

Multiple Choice

Which of the following is NOT a consequence of the CPI bias?

• A)The state of the economy will be understated.
• B)The CPI-indexed government transfer payments will be higher than the amount planned.
• C)The monetary policy that targets inflation will need to adjust for the CPI bias.
• D)The economic growth rate will be biased upward.

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