Author Question: If nominal wage rates increase by 5 percent per year and the price level increases by 3 percent per ... (Read 79 times)

arivle123 · **on:** Jun 30, 2018

If nominal wage rates increase by 5 percent per year and the price level increases by 3 percent per year, which of the following is correct?
a. Real wages will increase by 2 percent per year.
b. Real wages will increase by 3 percent per year.
c. Real wages will decrease by 3 percent per year.
d. Real wages will decrease by 2 percent per year.
e. Real wages will remain constant.

Question 2

Which of the following forms of money will earn at least some interest income?
a. Gold coins
b. Currency notes
c. Traveler's checks
d. Checkable deposits
e. Gift checks