Hungry Jacks Is Paying $9 an Hour to Its Workers

question 47

Multiple Choice

Hungry Jacks is paying $9 an hour to its workers.If the expected inflation rate equals the actual inflation rate and both are 10 per cent a year,then to keep the real wage rate constant in a year the money wage rate must

• A)rise to $10.00 an hour.
• B)stay at $9.00 an hour.
• C)rise to $9.45 an hour.
• D)rise to $9.90 an hour.
• E)fall to $8.10 an hour.

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Definitions:

Par Value

The face value of a bond or the stock value stated in the corporate charter, not necessarily reflecting the market value.

Coupon Bond

A type of bond that offers periodic interest payments to its holder, typically paid semi-annually, until maturity.

Duration

Duration is a measure of the sensitivity of the price of a financial asset to a change in interest rates, often used in the context of bonds to describe how price is affected by changes in rates.

Annual Coupon

The yearly interest payment paid to bondholders, typically expressed as a fixed percentage of the bond's face value.