56 The main drawback of the chained consumer price index (CPI) compared to thetraditional CPI is that the chained CPIa) is more difficult to calculate.b) is not updated as frequently.c) underestimates true inflation.O d) overestimates true inflation.e) includes only final goods and services.

CPI is used to calculate inflation level in the economy.

Answered: a) is more difficult to calculate. 5)…

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a) is more difficult to calculate. 5) is not updated as frequently. =) underestimates true inflation.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter22: Inflation

Section: Chapter Questions

Problem 33P: The index number representing the price level changes from 110 to 115 in one year and then from 115...

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