If We Look at the Nominal Versus Real Wage Rates

question 68

Multiple Choice

If we look at the nominal versus real wage rates paid to American presidents over time,we find that

• A)the real wage rate has steadily increased to $400,000 per year.
• B)George W.Bush is the highest paid according to real wage rates.
• C)George Washington was paid a higher real wage rate than Bill Clinton.
• D)George W.Bush's nominal wage is about equal to the average nominal wage paid all presidents.
• E)the nominal wage has increased and decreased at different times because of inflation.

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Definitions:

Payback Period

The duration required for an investment to produce sufficient cash flow to recoup its original expense.

Depreciates

The process of allocating the cost of tangible assets over their useful lives, reflecting the decrease in value over time.

Revenues

The income generated from normal business operations and includes discounts and deductions for returned merchandise.

Required Rate

A specific rate of return or interest rate required by investors or lenders to compensate for the risk of an investment or loan.