An example of the new goods bias in the CPI is the
A) introduction of higher quality brakes as standard equipment on new cars.
B) introduction of hybrid automobiles, vehicles that were not made until recently.
C) decreasing popularity of SUVs as the price of gasoline has risen.
D) switch from traditional car dealerships to low-cost Internet car buying services.
B
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Corporations receive funds when their stock is sold in the primary market. Why do corporations pay attention to what is happening to their stock in the secondary market?
What will be an ideal response?
A central bank may be reluctant to see its currency appreciate because
A) rising prices of imports will contribute to inflation. B) falling prices of exports will contribute to inflation. C) the country's goods may become uncompetitive in world markets. D) the country's monetary base will increase.