Last year Ann Heuser's the rate of increase in her nominal income was equal to the rate of inflation;therefore,her real income remained unchanged.

Question

Quizplus · Accepted Answer

If the rate of increase in Ann Heuser's nominal income was equal to the rate of inflation, then her real income remained unchanged. This is because inflation causes prices to rise, so if her income increases at the same rate as prices, her purchasing power remains the same. Therefore, the statement is true.

Last Year Ann Heuser's the Rate of Increase in Her