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Alik [6]
4 years ago
13

Julie received a 10% wage increase while consumer prices rose by 3%. how much did julie's real wage increase in nominal and real

terms? 7%*in real terms, but 10% nominally 10% nominally, but only 3% in real terms 3% in real terms, but 10% nominally 13% nominally, but 10% in real terms
Business
1 answer:
Elina [12.6K]4 years ago
4 0

Answer: 7%*in real terms, but 10% nominally

By real prices, we mean prices<span> adjusted for general price level changes over time like inflation or deflation. Nominal prices are the current dollar value of a product at the time it was produced.</span>

<span>Julie received a 10% wage increase but since the consumer prices rose by 3%, in real terms, the increase she received is only 7%. In nominal term, it is 10%.</span>

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