Question

Suppose you have two offers to start work after finishing your studies, which will be in one year and you have to choose between the two. However, the two positions and their location points are indifferent to you, as they both include the same benefits package. Job A will produce an annual salary of $ 24,000 starting a year from now and Job B will pay an annual salary of $ 25,000. No salary will be adjusted until you complete one year in office. After studying the regions where the firms are located, it is determined that inflation is likely to be absent where the employer, A, is located for at least two years.

In contrast, employer B is in an area in which the annual inflation rate for the next two years is likely to be 5%. What job should you accept? Why?

Answer 1

I will choose Job A add it offers greater real salary of $ 24,000 After 2 years from now

While Job B gives lesser.

The two locations are indifferent in all other terms except inflation so it make sense to choose Job A