Which of the following theories explains why increased education translates into higher wages?

Members of the European Monetary Union

A. adopt a common currency called the euro. B. float their domestic currency exchange rate with both the euro and the rest of the world. C. can continue to use their own domestic currency but are required to hold a stipulated amount of a common currency. D. cannot hold reserves of the common currency.

Substitution bias causes the CPI to understate the increase in the cost of living from one year to the next

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