Suppose a Local Union Has a Contract That Calls for the Nominal

question 33

Multiple Choice

Suppose a local union has a contract that calls for the nominal wage to increase by 5 percent plus 100 percent of any increase in the CPI.If the CPI increases by 4% and there is a 1% positive bias in the inflation rate,by how much would nominal wages unnecessarily increase?

• A) 9 percent
• B) 1 percent
• C) 5 percent
• D) 3 percent
• E) 4 percent

---

Definitions:

Behaviorists

Psychologists who study and interpret human behavior based on observable stimuli and responses, often excluding mental processes.

Mental Processes

The functions of the brain that involve thoughts, feelings, and cognitive activities, including perception, memory, and decision-making.

Social Psychologist

A scientist who studies how people's thoughts, behaviors, and feelings are influenced by the actual, imagined, or implied presence of others.

Sigmund Freud

An Austrian neurologist and founder of psychoanalysis, a clinical method for treating psychopathology through dialogue between a patient and a psychoanalyst.