Question 10 The annual rate of inflation is (1) a change in real income of workers from one year to the next. (2) the percentage change in the general level of prices from one year to the next. (3) the percentage increase in the total value of the goods and services produced from (4) the increase in the purchasing power of the dollar from one year to the next. (4).

To determine the correct definition of the annual rate of inflation from the provided options, let's analyze each statement: 1. **A change in real income of workers from one year to the next.** - This statement refers to changes in income, not directly to inflation. Inflation affects purchasing power but is not defined by changes in real income. 2. **The percentage change in the general level of prices from one year to the next.** - This statement accurately describes inflation. Inflation is typically measured as the percentage increase in the price level of a basket of goods and services over a specific period, usually a year. 3. **The percentage increase in the total value of the goods and services produced.** - This statement refers to economic growth or Gross Domestic Product (GDP) growth, not inflation. Inflation specifically deals with price levels, not the total value of production. 4. **The increase in the purchasing power of the dollar from one year to the next.** - This statement is incorrect. Inflation actually decreases the purchasing power of the dollar, as prices rise. Based on this analysis, the correct answer is: **(2) the percentage change in the general level of prices from one year to the next.**