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Saved Some wages, tax brackets, interest rates, and government benefits are based on the CPI. True or False

Saved Some wages, tax brackets, interest rates, and government benefits are based on the CPI. True or False

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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**Transcription:** Some wages, tax brackets, interest rates, and government benefits are based on the CPI. **Question: True or False** Buttons: - **True** - **False** --- **Explanation for an Educational Website:** This statement is a true/false question regarding economic indicators. The Consumer Price Index (CPI) is often used as a measure of inflation. As inflation influences the cost of living, governments and organizations may adjust: 1. **Wages:** Adjustments can help maintain the purchasing power of employees. 2. **Tax Brackets:** Changes can prevent "bracket creep," where inflation pushes taxpayers into higher tax brackets without an actual increase in real income. 3. **Interest Rates:** Influences monetary policy to control inflation and stabilize the economy. 4. **Government Benefits:** Programs like Social Security may use CPI to adjust benefits, ensuring recipients maintain their living standards despite inflation.
Transcribed Image Text:**Transcription:** Some wages, tax brackets, interest rates, and government benefits are based on the CPI. **Question: True or False** Buttons: - **True** - **False** --- **Explanation for an Educational Website:** This statement is a true/false question regarding economic indicators. The Consumer Price Index (CPI) is often used as a measure of inflation. As inflation influences the cost of living, governments and organizations may adjust: 1. **Wages:** Adjustments can help maintain the purchasing power of employees. 2. **Tax Brackets:** Changes can prevent "bracket creep," where inflation pushes taxpayers into higher tax brackets without an actual increase in real income. 3. **Interest Rates:** Influences monetary policy to control inflation and stabilize the economy. 4. **Government Benefits:** Programs like Social Security may use CPI to adjust benefits, ensuring recipients maintain their living standards despite inflation.
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