Why Do Economists Believe That the CPI May Not Be

Multiple Choice

Why do economists believe that the CPI may not be completely accurate?

A) Different consumers purchase different baskets.
B) The CPI is slow to include price decreases for new products, such as iPods.
C) The CPI is not able to adjust for changes in the price of imports.
D) Consumers tend to substitute lower-priced items for those in the fixed basket.