What are the difference real income and nominal income?
The nominal income is refer to the actual amount which a person
received in perticular time of period may be in month or weekly
which doest not have the effet of inflation and which is fixed in
any curcumtances , for e g if there is raise in the prise of the
commodities it leads the prise to the inflation but there will be
no effect on the Nominal income holder as it is fixed,however in
the Real income scenario the inflation amount will effect the real
income as it is to be deducted from the Bominal income.hence
Real income = Nominal income - inflation ,
Therefore we can say that real Income is the good measure to
know the actual purchasing power of the economy and good aggregate
to calculate the National Income