The Outlet Substitution Bias Is Most Likely to Put ________

question 93

Multiple Choice

The outlet substitution bias is most likely to put ________ and so ________ the inflation rate.

• A)a downward bias into the CPI;understate
• B)an upward bias into the CPI;understate
• C)an upward bias into the CPI;overstate
• D)a downward bias into the CPI;overstate
• E)no bias into the CPI because it is such a small effect;have no effect on

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Definitions:

National Saving

The total saving of a country, composed of the savings accumulated by both the private sector and the government, available for investment.

Aggregate Demand

A complete tally of the demand for goods and services in an economy, at an agreed upon price level during a precise time period.

National Defense

Government activities and infrastructure aimed at protecting a country from threats and maintaining its security.

Federal Outlays

Refers to the total amount of money the federal government spends in a fiscal year, including spending on services, subsidies, and interest on debt.