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Two economists Mark Bils and Peter Klenow investigated the raw data for 350 detailed spending categories that are used to generate the consumer price index (CPI)

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Two economists Mark Bils and Peter Klenow investigated the raw data for 350 detailed spending categories that are used to generate the consumer price index (CPI). They found that half of these categories changed their prices at least every 4.3 months. Using this information, if a price change for a particular CPI component occurs less (more) than 4.3 months, then that component is called a flexible-price (sticky-price) good. To highlight this difference, the Federal Reserve Bank of Atlanta produces separate indices for goods that have flexible prices on the one hand and sticky prices on the other hand. The graph shows the sticky-price CPI and flexible-price CPI (percent change from year ago) from 1967 to today. FRED 20 15 10 Percent Change from Year Ago -5 -10 1970 1975 1980 2005 2010 2015 1985 1990 1995 2000 Source: Federal Reserve Bank of Atlanta Shaded areas indicate U.S. recessions my.red/g/1631 Which line does represent the flexible-price CPI? (Blue solid line or the red dashed line) Why?