Suppose Workers Agreed to a Contract That Guaranteed a Real

Multiple Choice

Suppose workers agreed to a contract that guaranteed a real wage increase of 3 percent per year.If the inflation rate was 7 percent over the following year,what is the required increase in the nominal wage to meet the contract requirements?

A) 10 percent
B) 3 percent
C) 4 percent
D) 7 percent
E) 1 percent