A retired worker receives a pension that is not indexed to inflation. Which of the following will happen if the rate of inflation rises?
A) The retiree's purchasing power will fall.
B) The shareholders of the firm in which he worked will lose.
C) The retiree's purchasing power will increase.
D) The retiree will be better off.
A
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A market maker faces the following demand and supply for widgets. Eleven buyers are willing to buy at the following prices: $15, $14, $13, $12, $11, $10, $9, $8, $7, $6, $5 . Eleven sellers are also willing to sell at the same prices. If the market maker bought and sold at the equilibrium price, what is his profit
a. $1 b. $2.5 c. $3 d. $0
All final goods and services that make up GDP can be expressed asp
When the unemployment rate falls to the full-employment level:
A. There is increased concern about inflation. B. Many resources are idle. C. The size of the labor force decreases. D. There is increased concern about deflation.
Conservative economists believe that the crowding-out effect
A. is large because consumption demand is insensitive to interest rate changes. B. is not significant because the investment demand curve is interest insensitive. C. does not reduce the power of fiscal policy policies. D. greatly reduces the power of fiscal policy policies.