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:

Proverb of Sales Wisdom

A traditional or well-known saying that encapsulates advice or insight relevant to selling and sales practices.

Customer Choice

The decision-making process that consumers go through when selecting products or services among several alternatives.

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The process businesses undergo to gain additional customers or clients who have not previously purchased from the business.

Business Friendship

A relationship between colleagues or professional contacts that combines elements of friendship and business.