Looking at the following table,real average hourly earnings equals ________ in 2016. $$\begin{array} { | c | c | c | }
\hline \text { Year } & \begin{array} { c }
\text { Nominal Average } \
\text { Hourly Earnings, } \$
\end{array} & \text { CPI } \
\hline 2016 & 12 & 100 \
\hline 2017 & 13 & 105 \
\hline 2018 & 14 & 110 \
\hline
\end{array}$$

Question

Looking at the following table,real average hourly earnings equals ________ in 2016. $$\begin{array} { | c | c | c | } 
\hline \text { Year } & \begin{array} { c } 
\text { Nominal Average } \
\text { Hourly Earnings, } \$
\end{array} & \text { CPI } \
\hline 2016 & 12 & 100 \
\hline 2017 & 13 & 105 \
\hline 2018 & 14 & 110 \
\hline
\end{array}$$

Quizplus · Accepted Answer

The real average hourly earnings in 2016 is calculated by dividing the nominal earnings by the CPI (in decimal form). Since the CPI for 2016 is 100, the real earnings are $12 / (100/100) = $12.00.

Looking at the Following Table,real Average Hourly Earnings Equals ________