You are offered a 14 percent wage increase and the inflation

You are offered a 14 percent wage increase and the inflation rate for the year turns out to be 18 percent. The change in your real wage is nothing percent. (Round your response to the nearest whole number.)

With a negative 4 percent change in your real wage, you are than you were before.

A. Worse off

B. better off

C. No better or worse off

Solution

Change in real wage =14-18=-4

Since real wage is negative it decreases. Thus I am worse off than before