Your Father Tells You He Earned $1

question 50

Multiple Choice

Your father tells you he earned $1.50 per hour when he was 16 in 1969. Given that the CPI was 36.0 in 1969 and 215 in 2008, how much would you have to earn in 2008 in order to have the same real wage as your father in 1969?

• A) $1.50
• B) $5.00
• C) $8.95
• D) $15.00

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Definitions:

Current Tax Liability

The amount of income taxes a company is obligated to pay to governmental authorities within the next fiscal period.

Tax Deductible

Tax deductible refers to certain expenses or investments that can be subtracted from gross income to reduce the amount of income subject to tax.

Depreciation

The allocation of the cost of a tangible asset over its useful life, reflecting the decrease in value due to use and wear and tear.

Income Tax Rate

The percentage at which an individual or corporation is taxed on their income.