Which of the Following Would Allow a Worker to Be

question 61

Multiple Choice

Which of the following would allow a worker to be least hurt by inflation?  

• A) The worker anticipates inflation and increases his savings. 
• B) The worker has a cost-of-living adjustment clause in his employment contract. 
• C) The price level increases but at a decreasing rate. 
• D) The worker has fixed annual increases in wages and benefits in his employment contract.

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Definitions:

Initial Value Method

A method of accounting in which an investment is initially recorded at its cost without adjusting for changes in the market value over time.

Net Income

The conclusive profit of a corporation once revenue has had taxes and expenses subtracted from it.

Common Stock

A type of equity security that represents ownership in a corporation, with holders possibly entitled to dividends and voting rights in some corporate matters.

Fair Value

A valuation of an asset or liability determined by the price it could fetch in a coordinated sale or cost of transferring the liability, through a fair transaction involving willing market players.