For a country with a median nominal income of $44,000 at consumer prices. The index is 175 and the average real income is about 100. $18,857.
National Income = C + G + I + X + F - D
This concludes our article on the national income formula, which plays an important role in determining the income generated in a country. More formulas and concepts on economics for class 12 can be found on our website.
If the CPI is less than 100, the nominal income is the same as the real income. If inflation expectations rise, nominal interest rates are expected to rise, all else held constant.
CPI = (basket cost divided by base year basket cost) multiplied by 100. The CPI annual rate of change is also used to assess inflation.
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