Price Indexes Can Overstate Inflation Because They

question 314

Multiple Choice

Price indexes can overstate inflation because they

• A) omit some quality improvements.
• B) do not contain the prices of any used goods.
• C) do not contain the prices of foreign goods.
• D) do not contain the prices of services.

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Definitions:

Threat

An indication or warning of probable trouble, danger, or disaster.

Appeal To Force

A logical fallacy where one tries to win an argument by using threats or force instead of persuasion.

Fallacy

A flaw or error in reasoning that undermines the logical validity of an argument.

Sanctions

Penalties or other forms of enforcement used to encourage compliance with laws, regulations, or rules.