If the overall price level in the economy is rising and at the same time workers are able to buy more goods and services, then the _____ wage of workers must be _____ the rise in the price level.
A) nominal; falling at faster rate than
B) real; falling at a rate faster than
C) nominal; rising at a rate faster than
D) nominal; rising at the same rate as

Question

Quizplus · Accepted Answer

Nominal wages must be increasing at a rate faster than the rise in the price level for workers to be able to afford more goods and services despite inflation.

If the Overall Price Level in the Economy Is Rising