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Business, 17.06.2020 00:57 rajeeblagrove

Suppose Specific Automakers is considering signing a long-term contract with the union representing its workers. Specific Automakers and the union both agree that real wages should increase by 3%. Inflation is expected to be 6%, so they agree on a 9% nominal wage increase. Now, suppose inflation turns out to be higher than expected, coming in at 7%. This wouldthe union and Specific Automakers because the real wage increase would now be. This is an example of:. A. The re-distributive cost of inflation.
B. The re-source cost of inflation.

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