A price ceiling set below the market clearing price will tend to cause which of the following?

The substitution bias is believed to cause the consumer price index to:

a. overstate the true rate of inflation. b. understate the true rate of inflation. c. understate the true GDP deflator. d. none of these.

If a consumer is maximizing utility, she will purchase quantities of output to the point where the total utility per dollar spent on consumption is equal across all goods

a. True b. False Indicate whether the statement is true or false