If Workers and Firms Expect That Inflation Will Be 3

question 124

Multiple Choice

If workers and firms expect that inflation will be 3 percent next year,and real wages are not changing over time,by how much will nominal wages increase?

• A)3 percent
• B)more than 3 percent
• C)less than 3 percent
• D)depends on actual inflation for next year

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Definitions:

Hypothalamus

A region of the brain responsible for the regulation of certain metabolic processes and other activities of the autonomic nervous system, including temperature control, hunger, and thirst.

Depressant

A substance that reduces arousal or stimulation in various parts of the brain, often used to treat anxiety or insomnia.

Barbiturates

A class of drugs that are used as sedatives and hypnotics, and also for the treatment of epilepsy and insomnia, but have a high potential for abuse and addiction.

Mescaline

A psychedelic compound derived from the peyote cactus, known for its hallucinogenic effects, used both in traditional spiritual ceremonies and recreationally.