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    5. Real Wages = 500, Consumer price index = 1.2. Calculate nominal wages?

    Question

    Real Wages = 500, Consumer price index = 1.2. Calculate

    nominal wages?
    A 500 Correct Answer Incorrect Answer
    B 400 Correct Answer Incorrect Answer
    C 300 Correct Answer Incorrect Answer
    D 900 Correct Answer Incorrect Answer
    E 600 Correct Answer Incorrect Answer

    Solution

    Real Wage = Nominal Wages / Price Index 500 = Nominal Wages / 1.2 Nominal Wages = 500 (1.2) = 600

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