If the inflation rate is 6% and Susan receives a 6% increase in income, then, over the year, Susan's: (a) Real and nominal income both remain unchanged; (b) Real and nominal income both rise; (c) Real income rises but nominal income remains unchanged; (d) Nominal income rises but real income remains unchanged.

Exploring Economics
8th Edition
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:Robert L. Sexton
Chapter18: Introduction To Macroeconomics: Unemployment, Inflation, And Economic Fluctuations
Section: Chapter Questions
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Q.1.5 If the inflation rate is 6% and Susan receives a 6% increase in income, then, over
the year, Susan's:
(a) Real and nominal income both remain unchanged;
(b) Real and nominal income both rise;
(c) Real income rises but nominal income remains unchanged;
(d) Nominal income rises but real income remains unchanged.
Transcribed Image Text:Q.1.5 If the inflation rate is 6% and Susan receives a 6% increase in income, then, over the year, Susan's: (a) Real and nominal income both remain unchanged; (b) Real and nominal income both rise; (c) Real income rises but nominal income remains unchanged; (d) Nominal income rises but real income remains unchanged.
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