If Your Nominal Income in 2014 Is $50,000,and Prices Increase

question 72

Multiple Choice

If your nominal income in 2014 is $50,000,and prices increase by 50% between 2014 and 2017,then to have the same real income,your nominal income in 2017 must be

• A)$50,000.
• B)$75,000.
• C)$100,000.
• D)$150,000.

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Definitions:

Customer Margin

The profit generated from a particular customer, calculated by subtracting the costs associated with serving that customer from the revenue they generate.

Serving Customers

The activities involved in providing products or services to customers effectively.

Activity Cost Pools

Accumulations of costs grouped by similar or related activities, used in activity-based costing to allocate costs more accurately.

Supervisory Wages

The compensation paid to individuals who oversee the work of others, managing staff, and ensuring tasks are completed efficiently.