To Ensure That a Nominal Payment Represents a Constant Level

question 86

Multiple Choice

To ensure that a nominal payment represents a constant level of purchasing power over time, one should:

• A)add the price index to it.
• B)subtract the price index from it.
• C)divide it by the price index.
• D)increase it by a percentage equal to the rate of inflation for that year.

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Definitions:

Foster Brother

A boy or man who is not one's biological brother but with whom one shares a parental guardian through a formal or informal foster care arrangement.

Adoptive Brother

A male sibling who has become part of a family through the process of adoption, establishing a legal and social relationship.

Ex-spouses

Individuals who were once married to each other but have since been legally divorced.

Remarriage

The practice of entering into a new marriage following the dissolution of a previous marriage through divorce or the passing away of a spouse.