Workers in Country a Receive an Increase in Wages of 10

question 31

Multiple Choice

Workers in country A receive an increase in wages of 10 percent at the same time the inflation rate in country A is 8 percent.Workers in country B receive an increase in wages of 3 percent and the inflation rate in country B is 1 percent.In which country are workers better off?

• A)Country A because their real wages rise by 18 percent.
• B)Country A because their real wages rise by 10 percent.
• C)Country B because the inflation rate is lower.
• D)Neither country because the increase in real wages is the same.

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Definitions:

Assign Contract Rights

The act of transferring one's rights and obligations under a contract to another party.

Sale of Goods

The transaction of exchanging commodities for money between two parties, under regulated legal conditions.

Assignment Prohibited

A clause or condition in an agreement that restricts the transfer of rights or delegation of duties to another party.

Ownership Rights

Legal rights that confer the benefits and control over property, assets, or resources, allowing the owner to use, manage, and dispose of them.