One problem with the consumer price index stems from the fact that, over time, consumers tend to buy larger quantities of goods that have become relatively less expensive and smaller quantities of goods that have become relatively more expensive. This problem is called
a. price-change neglect.
b. unmeasured quality change.
c. substitution bias.
d. relative bias.
c
Economics
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Based on the table above, the cost of the base period market basket in the base period is
A) $3,300. B) $21.00. C) $3,250. D) $4,650. E) $4,885.
Economics
A flour mill holding exclusive contracts to 95% of the wheat in a large geographic area may operate as a flour-producing monopoly locally because
A) the mill has a very inelastic supply curve. B) the mill is a natural monopoly. C) the mill controls a key input. D) the government will declare it a monopoly.
Economics