To which of the problems in the construction of the CPI is the invention of pocket-sized computers most relevant?
A)substitution bias
B)introduction of new goods
C)unmeasured quality change
D)income bias

Question

Quizplus · Accepted Answer

The invention of pocket-sized computers is most relevant to the problem of "introduction of new goods." It is a new good that did not exist before, and it has become very popular in recent years. The CPI needs to account for the introduction of new goods because it shifts the consumer's basket of goods and affects the overall price level.

To Which of the Problems in the Construction of the CPI