The Substitution Bias in the Consumer Price Index Refers to the

question 172

Multiple Choice

The substitution bias in the consumer price index refers to the

• A)substitution by consumers toward new goods and away from old goods.
• B)substitution by consumers toward a smaller number of high-quality goods and away from a larger number of low-quality goods.
• C)substitution by consumers toward goods that have become relatively less expensive and away from goods that have become relatively more 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:

Systematic Procedures

Involves a methodical approach to tasks or operations that follow a specific, organized sequence of steps or protocols.

Mesosystem

A concept in Bronfenbrenner's ecological systems theory referring to the interconnections between different microsystems in an individual's life.

Bronfenbrenner's Bioecological

A theory that emphasizes the importance of understanding how the environment and biological systems mutually affect each other and development over time.

Accommodation

The cognitive process of revising existing cognitive schemas, perceptions, and understanding to incorporate new information.