A Firm Expects Inflation to Remain at 4 Percent for the Next

A firm expects inflation to remain at 4 percent for the next year. If the firm has been losing sales to competitors, it is most likely to

A) increase wages by 4 percent and keep prices constant.
B) increase prices and wages by 4 percent.
C) increase prices by 4 percent and keep wages constant.
D) increase prices and wages by more than 4 percent.
E) increase prices and wages by less than 4 percent.