The introduction of the video cassette recorder in the 1970s exemplified a problem in measuring the cost of living; that problem is the problem of
A)substitution bias.
B)product-improvement bias.
C)introduction of new goods.
D)unmeasured quality change.

Question

Quizplus · Accepted Answer

The introduction of new goods, like the video cassette recorder in the 1970s, presents a challenge in measuring the cost of living because it changes the basket of goods and services used to calculate inflation, making it difficult to compare the cost of living over time accurately.

The Introduction of the Video Cassette Recorder in the 1970s