Last year your job at the university cafeteria paid you $9 an hour and the price of a music download was $1.00 . This year your cafeteria job pays $9.90 per hour and download costs $1.10 . You are clearly
a. worse off because of inflation.
b. worse off because the download is now relatively more expensive.
c. better off because your wage rate went up.
d. better off because the download now costs less work.
d
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It is appropriate to use the supply-and demand-model if, in a market
A) everyone is a price taker with full information about the price and quality of the good. B) firms sell identical products. C) costs of trading are low. D) All of the above.
Functional finance is:
A. a theoretical proposition, not a moral proposition. B. a proposition supported by public choice economists. C. based on empirical evidence that fiscal policy can be effective in smoothing business cycles. D. based on the political realities of voters wanting their government to respond to recessions.