In Year 1, the Price Level Was 120 and the Average

question 119

Multiple Choice

In Year 1, the price level was 120 and the average nominal income was $30,000. In Year 2, the price level was 125 and the average nominal level of income was $32,000. What happened to real
Income from Year 1 to Year 2?

• A) It fell by $400.
• B) It rose by $400.
• C) It rose by $600.
• D) It rose by $2,000.

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Definitions:

Optimal Level

The most favorable or desirable degree or amount of something for achieving the best result or outcome.

Actual Stressors

Real and tangible factors in one's environment that cause stress.

Anticipatory Stressors

Upcoming or future events that are perceived to be threatening.

Sympathetic Division

Part of the autonomic nervous system that prepares the body for stressful or energetic activity, often termed the "fight or flight" system.