If Wages Grew at 5% Last Year and Average Prices

question 106

Multiple Choice

If wages grew at 5% last year and average prices grew at 3%, then the average worker:

• A) is better off.
• B) is worse off.
• C) has lost purchasing power.
• D) is unaffected.

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Definitions:

Demand Curve

A graph that relates the quantity sold and price, showing the maximum number of units that will be sold at a given price.

Pricing Approach

Strategies employed by businesses to set the price of their products or services, taking into account costs, demand, and competition.

Prestige Pricing

A pricing strategy where prices are set higher than average to create an image of exclusivity and high quality, appealing to status-conscious consumers.

Demand-oriented Approach

focuses on understanding and meeting the existing demand of consumers as the primary strategy for product development and marketing.