Multiple Choice
Which of the following statements about the CPI is/are correct?
i.The only significant bias in the CPI is the commodity substitution bias.
ii.In Australia it is estimated the CPI overstates inflation by 1.1 percentage points a year.
iii.The RBA estimates that substitution bias is about 0.5 percentage points.
A) i only
B) ii only
C) iii only
D) ii and iii
E) i and ii
Correct Answer:
Verified
Correct Answer:
Verified
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