A consumer's real income automatically falls when his or her cost of living rises, regardless of any increase in earnings.

Name: A consumer's real income automatically falls when his or her cost of living rises, regardless of any increase in earnings.
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Question

Quizplus · Accepted Answer

A consumer's real income only falls if the increase in earnings is less than the increase in the cost of living. If earnings increase at the same rate or higher than the cost of living, real income may stay the same or even increase.

A Consumer's Real Income Automatically Falls When His or Her