Answer to Question #309005 in Microeconomics for Kinza Tariq

Question #309005

9. Suppose a worker's income was $15,000 in 1960 and $45,000 in 2010. Using the GDP deflator as a price index, calculate whether the worker's real income had increased or decreased over this period.

1
Expert's answer
2022-03-14T13:16:49-0400

"GDP\\ deflector=\\frac{Real\\ GDP}{Nominal\\ GDP}"

"=\\frac{\\$45000}{\\$15000}\\times100=300"

The worker's real income increased by 300%


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