In 1986, an Apple IIe computer with 65 kilobytes of memory cost around $1,500. Today, a $1,500 iMac computer (also made by Apple) comes with 8 gigabytes of memory. This illustrates the potential for what kind of bias in CPI calculations?
A) outlet bias B) new product bias
C) increase in quality bias D) substitution bias
C
You might also like to view...
Gross domestic product (GDP) figures tend to understate the quantity of goods and services available because: a. GDP excludes the value of goods produced at home
b. many items are counted twice or more in the intermediate stages of production. c. more women are entering the labor force. d. firms often add less to inventories than they planned to. e. exports are subtracted from GDP but imports are not added.
The more firms that pay efficiency wages, the
A) more likely the economy will get stuck in a recessionary gap. B) less likely the economy will get stuck in a recessionary gap. C) more likely the economy will get stuck in an inflationary gap. D) more likely (over time) the economy will produce Natural Real GDP. E) b and c