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Suppose inflation is expected to be 5 percent next year, and you and your employer agree to a 6 percent increase in your nominal, or
Suppose inflation is expected to be 5 percent next year, and you and your employer agree to a 6 percent increase in your nominal, or monetary, wage. If inflation turns out to be 5%, what is your real wage increase?
Question options:
1 percent
minus 1 percent
0 percent
minus 5 percent
6 percent
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