A worker would be hurt least by inflation when the:
A)worker anticipates inflation and increases savings at the bank.
B)worker is protected by a cost-of-living adjustment clause in an employment contract.
C)worker is protected by fixed annual increases in wages and benefits in an employment contract.
D)government increases the level of social security retirement benefits to correct for the effects of anticipated inflation.

Question

Quizplus · Accepted Answer

A cost-of-living adjustment clause in an employment contract accounts for inflation by automatically adjusting wages to match the rate of inflation, meaning the worker's purchasing power is maintained. The other options may offer some protection against inflation, but not to the same extent as a cost-of-living adjustment.

A Worker Would Be Hurt Least by Inflation When The