When the Price of Gasoline Rises by 40 Percent, but Your

question 116

Multiple Choice

When the price of gasoline rises by 40 percent, but your salary remains the same, it is an example of a decline in your:

• A)standard of living
• B)purchasing power
• C)GDP index
• D)cost of living index
• E)gross economic income

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Definitions:

Withholding Allowance

A claim made by employees on the W-4 form to reduce the federal income tax withheld from their paycheck.

Taxable Income

The portion of an individual's or business's income that is subject to income tax, after exemptions and deductions.

Taxable Income

The amount of an individual's or entity's income used to determine how much tax is owed, calculated as gross income minus deductions and exemptions.

Monthly Salary

The amount of money an employee is paid each month for their job performance, not including bonuses or overtime pay.