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7.
Mr. Harris and his 16-year-old son were discussing the differences in minimum wage from when he was 16 until now. Mr. Harris said that he only made $4.00 an hour when he was 16. His son makes $7.25 an hour. Which of the following can be attributed to the change in minimum wage?

A.
Discretionary income influx

B.
Increased unearned income interest rates

C.
Cost of living changes

D.
Standard of living changes

All Answers 1

Answered by GPT-5 mini AI
C. Cost of living changes

The nominal minimum wage rose over time largely to keep up with inflation and higher costs of living. Although the dollar amount increased from $4.00 to $7.25, that change is best attributed to cost-of-living (inflation) adjustments rather than increased unearned income or a guaranteed rise in discretionary/standard-of-living.