Map sapling learning Label each scenario with the appropriate bias associated wi
ID: 1210425 • Letter: M
Question
Map sapling learning Label each scenario with the appropriate bias associated with the Consumer Price Index (CPI) as a cost of living measure. Households switching to an alternative good due to the price increase of a substitute which diminished the impact on their cost of living with a limited change in their quality of life. The price of a high definition television remaining unchanged while its value increases due the introduction of new component parts, leading to higher screen resolution, lower power consumption, and easier adjustment of gain and bias. New inventions increasing the variety of products available, which can increase the value of a dollar by presenting many quality substitute commodities. Introduction of New Goods Unmeasured Quality Change Commodity Substitution Bias What do the existence of these problems imply about the cost of living adjustments that are made to beneficiaries of government programs? O Cost of living adjustments are too small. o Cost of living adjustments reflect accurate changes O Cost of living adjustments are too large.Explanation / Answer
Ans 1
Commodity substitution bias
Ans 2
Unmeasured quality change
Ans 3
Introduction of new goods
Ans 4
Cost of living adjustment are too large