What Is Real Income?

Real income, English for real income, is the purchasing power of nominal income. It is the goods and services that can be purchased with nominal income compared to the previous period.

actual income

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Real income, English for real income, is

Real income should include

Real income = (rate of change in nominal income-rate of change in price level) / rate of change in real income

Real money income index = money income index / cost of living price index = money income index / money purchasing power index

Real income = Nominal income / CPI of the year * 100%