Economics 2281 · O Level · Inflation and deflation

Inflation and deflation — practice question

During one year, a company experienced two changes. Company directors’ salaries went up by $15\%$. Office workers’ wages went up by $5\%$. The inflation rate was $3.4\%$. What happened to real income?

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

Worked solution & mark scheme

This 1-mark question has a full step-by-step worked solution and mark scheme.

  • Full mark scheme, point by point
  • Step-by-step worked solution
  • Write your answer & get it marked instantly by AI