A widely acknowledged problem with using the consumer price index as a measure of the cost of living is that it fails to account for the introduction of new goods.
More about consumer price index and its problem-
- A more accurate indicator of a nation's standard of living than per capita GDP is the consumer price index or CPI.
- It is based on the total cost of a fixed basket of goods and services purchased by an average customer in comparison to the cost of the same basket in a base year.
- The CPI can get a precise assessment of the cost of living by including a wide range of thousands of items and services with the set basket.
- It's crucial to keep in mind that the CPI is an index number or a percentage change from the base year rather than a monetary value like the GDP.
- Because CPI is based on a fixed basket of products, the CPI does not provide an entirely accurate measure of the cost of living, despite being a convenient approach to calculate the cost of living and the relative price level over time.
- The bias against substitution, the introduction of new products, and quality variations are three issues with the CPI that should be mentioned.
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The fundamental purpose of a prototype is to help a company better understand its new product designs.
<h3 /><h3>What is prototyping?</h3>
It is the process of producing a sample of a product, which will serve as an initial representation that will later be produced on a large scale, helping to save time, costs and increasing learning about organizational projects.
Therefore, prototyping is a design process that helps an organization to gain more information to develop its business projects.
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The technique that's employed by the project manager is PERT technique.
<h3>What is a project?</h3>
It should be noted that a project simply means a work that's carried out in order to achieve a desired goal.
In this case, since the manager is reviewing the chronological sequence of activities that must be completed on the project, he's using the PERT technique.
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