The currently used method for calculating the CPI
A) accounts for people increasing consumption of a good that falls in relative price.
B) probably overstates inflation.
C) has no effect on government expenditures.
D) None of the above answers are correct.

Question

Quizplus · Accepted Answer

The method used for calculating the Consumer Price Index (CPI) likely overstates inflation because it does not fully account for changes in consumption patterns or improvements in the quality of goods and services over time.

The Currently Used Method for Calculating the CPI