Economics 1st Edition by Dean Karlan,Jonathan Morduch

تمرين 15

General Electric paid its line workers $10 per hour last year when the Consumer Price Index was 100. Suppose over the past year, deflation occurred and the aggregate price level fell to 80.
a. What must GE pay its workers this year in order to keep the real wage fixed?
b. What must GE pay its workers this year if it wanted to increase the real wage by 10 percent?
c. If GE keeps its workers' wages fixed at $10 per hour, how big a raise do its workers get in real terms?