Which of the Following Is Correct

question 40

Multiple Choice

Which of the following is correct?

• A) People whose nominal incomes rise slower than the rate of inflation gain purchasing power.
• B) Real income equals nominal income multiplied by the CPI as a decimal.
• C) The percentage change in real income equals the percentage change in nominal income plus the percentage change in CPI.
• D) The actual number of dollars received is called a nominal income.

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Definitions:

Fixed Assets

Long-term tangible assets held for business use and not expected to be converted into cash in the upcoming fiscal year.

Producing Goods

Producing goods involves the processes and activities of manufacturing or creating products from raw materials for sale.

Noncash Revenues

Revenues earned by a company for which cash has not been received, often recognized through accrual accounting.

Operating Activities

Part of the cash flow statement, these activities relate directly to the trading activities of the business, including the production, sales, and delivery of the company's products and services.