Even if inflation exists, your purchasing power from one period to the next will stay intact if:
A)you do not receive a pay rise.
B)your pay rise exactly matches the rate of inflation.
C)the rate of inflation is less than 1%.
D)you buy the same goods and services that you bought last year.

Question

Quizplus · Accepted Answer

When your pay rise matches the rate of inflation, it means your income increases at the same rate as prices, maintaining your purchasing power.

Even If Inflation Exists, Your Purchasing Power from One Period