CA Foundation · Quantitative Aptitude · Index Numbers
An employee at a Pune firm earns a money wage of ₹45,000 per month in a year when the consumer price index is 180 (base year = 100). What is the real wage in base-year rupees?
The real wage is ₹25,000. Deflating means dividing the money wage by the price index and multiplying by 100, so 45,000 ÷ 180 × 100 = ₹25,000 in base-year purchasing power.
- A₹36,000
- B₹25,000Correct
- C₹81,000
- D₹56,250
Explanation
Real wage = money wage / CPI × 100 = 45,000/180 × 100 = ₹25,000. Check: 25,000 × 1.8 = 45,000. Multiplying by the index (₹81,000) is wrong because deflating requires division. ₹56,250 comes from dividing by only the 80-point rise (45,000 × 100/80), which is also incorrect.
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