Employees at the University Have Negotiated a 5 Percent Increase

question 205

Multiple Choice

Employees at the university have negotiated a 5 percent increase in wages for the next year,based on their inflation expectations.If inflation is actually 6 percent over the next year,which of the following will occur?

• A)Unemployment of university employees will rise.
• B)Real wages for university employees will fall.
• C)Inflation will be 5 percent the following year.
• D)The increase in inflation is expected.

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Definitions:

Monthly Expenses

Recurring costs or outlays that occur every month, such as rent, utilities, payroll, and other operational charges.

Master Budget

A comprehensive financial plan that includes both operational and financial budgets, representing a company’s overall plan of action for a future period.

Budgeted Sales

The projected amount of sales revenue a company expects to receive within a specific period, as part of its financial planning process.

Credit Sales

Credit sales are transactions where the customer purchases goods or services on account, agreeing to pay the supplier at a later date.