Which of the Following Formulas Gives You the Growth in Purchasing

question 16

Multiple Choice

Which of the following formulas gives you the growth in purchasing power?

• A) (1 + real rate) / (1 + nominal rate)
• B) growth of money / growth of prices
• C) growth of money + growth of prices
• D) (1 + inflation rate) / (1 + nominal rate)

---

Definitions:

Federal Poverty Level

A measure of income issued every year by the Department of Health and Human Services to determine eligibility for certain programs and benefits.

Nonparental Care

Childcare that is provided by individuals who are not the child's parents, including daycare centers, nannies, and relatives other than parents.

Employed Mothers

Employed mothers refers to women who participate in the workforce while also fulfilling the role of a mother, balancing professional and familial responsibilities.

Poverty Level

The minimum level of income deemed adequate in a particular country to live on.