Comprehensionhard · Past Paper
The company announced a 10% raise for all employees, but simultaneously increased health insurance premiums by 15%. What can be inferred about the employees' take-home pay?
AIt will significantly increase.
BIt will likely stay the same or decrease.
CEmployees will no longer need insurance.
DThe company is going bankrupt.
✓ Correct Answer: B — It will likely stay the same or decrease.
If costs (premiums) rise more than income (raise), the net financial benefit is neutralized or negative.
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