Economics 2281 · O Level · Inflation and deflation

Inflation and deflation — practice question

Within one year, a company experienced two alterations. Company directors’ salaries went up by $15\%$. Office workers’ wages rose by $5\%$. The inflation rate was $3.4\%$. What was the effect on real income?

  • Acompany directors fell and office workers fell
  • Bcompany directors fell and office workers rose
  • Ccompany directors rose and office workers fell
  • Dcompany directors rose and office workers rose

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