Question

You find that to attract a sufficient number of workers you have to pay them more dollars. Given the price of your output you determine you are paying your workers more in goods than before. Which of the following has risen?

a.The real and nominal value of the wages you pay.
b.The real but not the nominal value of wages you pay.
c.The nominal but not the real value of the wages you pay.
d.Neither the real nor the nominal value of the wages you pay.

Answer 1

A) The real and nominal value of the wages you pay.

Step-by-step explanation:

Nominal wages are wages paid to workers in monetary value whereas Real wages can be explained or regarded as the amount of goods or services that are purchases by a worker from his nominal wages. Here, the real wages are known as the purchasing power of nominal wages. The supply of labour solely depends on the nominal wages avwirker received. An economic situation of the worker depends on the amount of goods and services he can procure with nominal wages. It is not necessary that his real wages will increase. The economic situation of a worker depends on his real wages.

Answer 2

The real and nominal value of the wages you pay.

Step-by-step explanation:

Real wages are the value of wages that are adjusted for inflation and an increase reflects in an individual being able to buy more with their wages earned.

Nominal wages is a rate that is not adjusted for inflation.

In this instance you are paying the workers more in goods than before, so their salarie's purchasing power has increased. This increase reflects an increase in both real and nominal wage rates.