Question 31 (1 point) The effect of substitution bias is that the rise in the price of a fixed basket of goods over time tends to ___ the rise in a consumer's true cost of living, because it doesn't take into account that the person can substitute between goods according to changes in their relative prices. overstate understate reduce stabilize Question 32 (1 point) The producer price index is: a) information from the consumer expenditure survey. O b) price indexes for approximately 500 mining and manufacturing industries. d an aggregate of prices of intermediate goods used by domestic producers to produce their output. O d) a fluctuating bundle of consumer goods and services. Question 33 (1 point) Which of the following statements does describe a problem in measuring the consumer price index (CPI)? O a) Approximately 10% of the original market basket must be replaced each year by products that are improved or modified. O b) All of the answers are correct O c The CPI measures only private goods and services. O d) The CPI uses a fixed market basket of goods determined by surveys that are three to five years old.Question 37 (1 point) Because of the substitution bias the consumer price index can the rate of inflation. O a) accurately states O b) disinflates O c) overstates O d) understates Question 38 (1 point) is a measure of the change in average prices paid by urban consumers for a typical market basket of goods and services. O a) The producer price index O b) Personal consumption expenditure O c) The consumer price index O d) The GDP deflator