If the Cost of Living Index rises by 10%, a wage earner's real income remains unchanged only if nominal wages increase by: MCQ with Answer and Explanation
If the Cost of Living Index rises by 10%, a wage earner's real income remains unchanged only if nominal wages increase by:
A. 10%
B. 20%
C. 15%
D. 5%
Answer: Option A
Solution (By JKSSB Mock Tests)
Real income = Nominal income / Price index. To keep real income constant when prices rise 10% (index ×1.10), nominal income must also rise 10% (×1.10), so the ratio remains unchanged.
Explanation:
Population variance = 100/10 = 10. Sample variance would be 100/9≈11.11, but question likely assumes population. I'll specify 'if data is population', but not specified. I'll assume population for simplicity.
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