Suppose the economy consists of two distinct groups: wage earners and goods sellers.If the price level increases by 30 percent and real wages increase by 30 percent,
A) there will be no redistribution of purchasing power between goods sellers and wage earners
B) purchasing power will be redistributed from wage earners to goods sellers
C) purchasing power will be redistributed from goods sellers to wage earners
D) nominal wages will increase by 90 percent
E) nominal wages will decrease by 60 percent

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The Answer of Suppose the economy consists of two distinct groups: wage earners and goods sellers.If the price level increases by 30 percent and real wages increase by 30 percent,
A) there will be no redistribution of purchasing power between goods sellers and wage earners
B) purchasing power will be redistributed from wage earners to goods sellers
C) purchasing power will be redistributed from goods sellers to wage earners
D) nominal wages will increase by 90 percent
E) nominal wages will decrease by 60 percent

Suppose the Economy Consists of Two Distinct Groups: Wage Earners