Find percentage change in real income with index numbers

Reference no: EM13179178

Assume that nominal income is $35,000 and the price index is 1.20 in year 1. In year 2, nominal income rises to $38,000 and the price index rises to 1.25. What was the percentage change in real income from year 1 to year 2? Make your calculations of the percentage change in real income with index numbers.

Reference no: EM13179178

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