The Reason That Inflation Rarely Harms Workers Is That

question 141

Multiple Choice

The reason that inflation rarely harms workers is that

• A)wages rise at the same time prices rise.
• B)wages fall when prices rise.
• C)nominal income falls as prices rise.
• D)the minimum wage rate automatically rises when the price level rises.

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Definitions:

Revenues

The sum of money a business acquires from selling goods or offering services over a certain time frame.

Households

Economic units that represent all individuals living in a single dwelling, sharing income and expenses; primary consumers in the economy.

Centrally Planned Economies

Economic models in which all decisions about what to produce and how to distribute goods and services are made by the government or a central body.

Resource Allocation

The process of assigning and distributing available resources to various uses in the most efficient way.