Question

Sue's employer increases her salary each year at a rate that is 1.5 times the going...

Sue's employer increases her salary each year at a rate that is 1.5 times the going rate of inflation. Each year Sue’s real salary ______ and she feels like she can buy a _____ quantity of goods and services.

increases : smaller

increases : larger

decreases : larger

decreases : smaller

0 0
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Answer #1

Increases, larger

Explanation: Real income is the difference between nominal income and inflation rate. When the nominal income increases faster than inflation rate, the real income rises. This increases purchasing power.

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