What Does the "Substitution Bias" in the Consumer Price Index

question 105

Multiple Choice

What does the "substitution bias" in the consumer price index refer to?

• A)substitution of new goods for old goods in the purchases of consumers
• B)substitution of quality for quantity in consumer purchases over time
• C)the fact that consumers substitute toward goods that have become relatively less expensive
• D)substitution of new prices for old prices in the basket of goods from one year to the next

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