When the Quality of a Good Deteriorates, What Happens to the Purchasing

Multiple Choice

When the quality of a good deteriorates, what happens to the purchasing power of the dollar?

A) It increases, so the CPI overstates the change in the cost of living if the quality change is not accounted for.
B) It increases, so the CPI understates the change in the cost of living if the quality change is not accounted for.
C) It decreases, so the CPI overstates the change in the cost of living if the quality change is not accounted for.
D) It decreases, so the CPI understates the change in the cost of living if the quality change is not accounted for.