Question

Suppose a workers' union managed to sign a new wage contract with the employer for a 5% nominal wage increase for the coming year. The union also believes that the inflation rate next year is going to be 5%. Which of the following is CORRECT? The real wage has decreased by 5% O b. The real wage has increased by 10% None of the answers is correct O d. The real wage has increased by 5%

Answer 1

(d) The real wage has increased by 5% is the correct answer for the given question.

What is contract?

A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to transfer any of those at a future date. In the event of a breach of contract, the injured party may seek judicial remedies such as damages or rescission. Contract law, the field of the law of obligations concerned with contracts, is based on the principle that agreements must be honoured. Contract law, like other areas of private law, varies between jurisdictions. The various systems of contract law can broadly be split between common law jurisdictions, civil law jurisdictions, and mixed law jurisdictions which combine elements of both common and civil law.

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