If Actual Inflation Is Greater Than Expected Inflation,what Is the Relationship

question 189

Multiple Choice

If actual inflation is greater than expected inflation,what is the relationship between the actual real wage and the expected real wage?

• A)The actual real wage will be lower than the expected real wage.
• B)The actual real wage will be higher than the expected real wage.
• C)The actual real wage will be equal to the expected real wage.
• D)The relationship between the actual real wage and the expected real wage cannot be predicted.

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Definitions:

Net Exports Component

The difference between a country's total exports of goods and services and its total imports, part of the gross domestic product calculation.

Consumption Component

The part of total economic output that is used by individuals and households for personal needs and wants.

Additions to Inventory

Increases in the quantity of goods held by a company during a particular period, often for future sale or production use.

Reductions in Inventory

Decreases in the quantity of goods that a company holds, which can indicate stronger sales or a preparation for lower demand.