Because the Minimum Wage Is Not Indexed to Inflation, When

question 64

Multiple Choice

Because the minimum wage is not indexed to inflation, when there is inflation the nominal minimum wage ________, and the real minimum wage ________.

• A)remains constant; decreases
• B)remains constant; remains constant
• C)decreases; remains constant
• D)increases; decreases

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Definitions:

Total Fixed Cost

The aggregate sum of all expenses within a company that remain constant regardless of the level of production or sales.

Fixed Cost Per Period

Costs that do not vary with the level of production or sales within a certain range and time frame, such as rent or salaries.

Mixed Cost

A cost that contains both variable and fixed cost elements and changes in total with the level of activity, but not proportionately.

Maintenance Cost

Expenses incurred to keep property, equipment, or assets in effective operating condition.