An Advantage of the Personal Consumption Expenditures Price Index (PCE)over

question 114

Multiple Choice

An advantage of the personal consumption expenditures price index (PCE) over the Consumer Price Index (CPI) as a measure of inflation is that the PCE

• A)includes the prices of more consumer goods and services.
• B)includes the prices of consumer goods,but not consumer services.
• C)includes the prices of consumer services,but not consumer goods.
• D)is a fixed market-basket price index that does not allow the mix of products to change each year.

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Definitions:

Voluntary

A term indicating that an action or process is undertaken by someone's own choice or consent, without external compulsion.

Mandatory

Something that is required or obligatory by law or rules.

Chilling Effect

A chilling effect occurs when the exercise of rights or freedoms is discouraged by the threat of legal sanction or other negative consequences, leading to self-censorship or avoidance of certain actions.

Arbitration

A method of dispute resolution where an impartial third party, the arbitrator, makes a binding decision to resolve a dispute outside of court.