If the "Nominal Price" of a Good Has Risen by 10

question 112

True/False

If the "nominal price" of a good has risen by 10 percent over a period of time, its relative price must also have risen.

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Definitions:

Fixed Expenses

Costs that do not change with the level of production or sales over a certain period, such as rent, salaries, and insurance.

Selling Price

The amount of money charged for a product or service offered to customers.

Absorption Costing

A method of accounting for costs in which all costs of manufacturing a product, including both fixed and variable costs, are considered product costs.