Sounds like you've got it, at the end.
Your example
Say that the retail price for milk is 2, the cost of producing it was reduced from 1 to 0.5, thus if the government is still paying the benefits according to 2, it is greater than warranted by the true change in costs. So I thought that this shift from discussing retail prices to cost of production is legitimate. If the cost lowers but the price remains the same, that means that the company that makes the good now has a higher profit margin.
But to the consumer, nothing has changed.
And since this is a "CONSUMER price index" and it's meant only to reflect cost of living, all we would care about is how much it costs to buy stuff at the store (not how much it costs to manufacture it).
I see your point about wanting to make sure that "at least some of the goods/services in the CPI are subject to the changing production costs". The first sentence kinda makes it sound like the CPI measures everything, so I don't think we're supposed to be worried about that.
Even if we were, (B) would not be doing a great job of specifying what it is you're demanding.
(B) wants a full list of which good and services are included. That list, by itself, wouldn't tell us whether any of those goods and services are subject to technology reducing production costs.
We'd need a separate list of all the goods/services for which tech might lower production costs so that we could cross reference the two lists to see if there are any common members.
You'd really want the answer to say
"fails to make explicit whether any goods and services measured by the consumer price index are subject to having their production costs reduced by technology"