Suppose Workers and Employers Agree to a Three-Year Wage Contract

Multiple Choice

Suppose workers and employers agree to a three-year wage contract under the expectation of 3 percent inflation, but inflation turns out to be 1 percent. In this case, ________ lost purchasing power, and ________ gained purchasing power.

A) employers; workers
B) no one; employers
C) workers; employers
D) employers; no one