I have read the wiki entry on this here:
http://en.wikipedia.org/wiki/Real_versus_nominal_value
I understood most of it, but the calculation is not laid out in the best manner and doesn't explain things too well.
I also read this link that explains the difference:
http://economics.about.com/cs/macrohelp/a/nominal_vs_real.htm
but the 3rd example of wages over a 2 year period is not well explained - how does he arrive at year 2 real wages of $49,107, and, can someone explain why the forumlae is laid out as it is please?
If someone could do it in laymans terms (as much as possible) and also give me a few examples - say for real VS nominal wages and a commodity, say house prices, over a 5 year period to illustrate exactly what is going on, i would really appreciate it.
Many thanks!
2007-02-22
23:38:14
·
5 answers
·
asked by
dave g
1
in
Economics