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real wage

1. Difference Between Money Wages And Real Wages In Hindi

or

real income

Nominal wages is the actual money earned Real wages is nominal wages minus inflation Why have real wages gone up over time, along with productivity? Real Income Formulas. For example, a mid-level manager with a nominal $60,000 per year salary might follow the CPI to calculate their real hourly, weekly, monthly, and annual wage rate.

the MONEY WAGE rate divided by the general PRICE LEVEL of products. Notationally, this is written W/P If wages and prices both rise by, say, 10% from an initial index number of, say, 100, the original ratio of W/P is 100/100 = 1, and the new ratio of 110/110 is also 1. An increase in real wages occurs when wages rise more quickly than prices or prices remain constant. In the latter instance, a rise in wages of 10% would give the ratio 110/100 = 1.1, thus making the wage earner 10% better off because he is capable of purchasing 10% more products with his new wage.

The analysis of real and money wages in relation to employment and output is a continuing central theme within economics although it is generally thought to be real wages that determines the level of employment rather than money wages. See CLASSICAL ECONOMICS, KEYNESIAN ECONOMICS, MONEY ILLUSION.

Difference Between Money Wages And Real Wages In Hindi