Last year the Olsen family earned $70,000. This year their income is $77,000. In an economy with an inflation rate of 8%, we can conclude the Olsen's nominal income:
a. and real income both increased
b. and real income by decreased
c. increased, but their real income decreased
d. decreased, but their real income increased
e. none of the above.
Real income is the income of an individual after adjusting for ...
The solution discusses the macroeconomic impact on income.