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      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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