If a private wage contract is agreed upon with a cost of living adjustment such that wage hikes are equal to increases in the CPI,
A) the employer benefits because wages will rise less than the change in actual prices.
B) workers exactly keep pace with changes in the cost of living.
C) workers benefit because the CPI increases more rapidly than does the cost of living.
D) the CPI bias means that workers benefit if the price level rises and the employer benefits if the price level falls.
E) the CPI bias means that workers benefit if the price level falls and the employer benefits if the price level rises.
C
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Whenever statements embodying values are made, we enter the realm of
A) positive economics. B) normative economics. C) microeconomics. D) macroeconomics.
The “cost disease of personal services” phenomenon helps explain why medical care has become so expensive.
Answer the following statement true (T) or false (F)