The Substitution Bias in the Consumer Price Index Refers to the

question 106

Multiple Choice

The substitution bias in the consumer price index refers to the

• A)substitution by consumers of new goods for old goods.
• B)substitution by consumers of a smaller number of high-quality goods for a larger number of low-quality goods.
• C)fact that consumers substitute toward goods that have become relatively less expensive.
• D)substitution of new prices for old prices in the CPI basket of goods and services from one year to the next.

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Definitions:

Frontal Lobe

The part of the brain located at the front of each cerebral hemisphere, responsible for voluntary movement, reasoning, planning, and problem-solving.

Self-Awareness

The awareness of one's own personality, emotions, motivations, and wishes.

Self-Esteem

A measure of how much value people place on themselves, often reflecting confidence and satisfaction in one's own abilities and worth.

Downward Comparison

A social comparison strategy where individuals compare themselves with others who are less well off in order to boost their own self-esteem.