The Table Shown Displays Yearly Salaries and the CPI Across

question 87

Multiple Choice

The table shown displays yearly salaries and the CPI across five decades. Suppose your father tells you he earned a yearly salary of $45,000 in 1980. This salary figure is the:

• A) nominal value of his salary in 1980.
• B) real value of his salary in 1980.
• C) value of his 1980 salary adjusted to 2009 dollars.
• D) value of his 1980 salary adjusted for inflation.

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Definitions:

Cost of Goods Sold

Direct costs attributable to the production of the goods sold by a company, including the cost of materials and labor.

Periodic Inventory System

A method of inventory management where updates to inventory levels are made at specific intervals, typically at the end of an accounting period, rather than continuously.

Inventory Shipped on Consignment

Goods sent by a vendor (consignor) to a consignee, which are held by the consignee until sold; the consignor retains ownership until the goods are sold.