The wage rate considered acceptable to workers engaged in collective bargaining will be determined in part by what monetary policy workers expect in the near future.

Question

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This is because if workers expect inflation to increase in the near future, they will demand a higher wage rate to compensate for the decrease in real purchasing power. On the other hand, if they expect inflation to decrease or remain stable, they may be willing to accept a lower wage rate. Monetary policy, which includes measures such as changes in interest rates and the money supply, can affect inflation rates, thus influencing the wage rate deemed acceptable by workers.

The Wage Rate Considered Acceptable to Workers Engaged in Collective