Assume Contracts Between Workers and Employers That Call for an Increase

question 81

Multiple Choice

Assume contracts between workers and employers that call for an increase in the wage rate of 5 percent are based on an expected inflation rate of 3 percent.Should inflation actually be 6 percent, then

• A)nominal wages fall by 5 percent.
• B)real wages fall by 6 percent.
• C)nominal wages fall by 1 percent.
• D)real wages fall by 1 percent.

---

Definitions:

Clay

A natural, earthy material consisting of fine minerals with plasticity when moist, used for making bricks, pottery, and sculptures.

Pounds of Plastic

A measure of weight used to quantify plastic material, often used in manufacturing or recycling contexts.

Campaign Speeches

Public addresses given by politicians or candidates aiming to persuade or inform voters about their platforms, policies, and values during an election campaign.

Flyers Mailed

The number of printed promotional materials sent out to recipients via postal services to communicate information or advertise.