Assume that Ernesto earned a nominal wage rate of $15 per hour in 2001, the base year for the CPI. If the CPI in 2002 was 102.6 and his nominal wage rate was $16 per hour, what was his real wage rate in 2001?

a. $14.62
b. $15.00
c. $15.59
d. $16.00
e. His real wage for 2001 cannot be determined with the information given.

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The budget line is useful for illustrating the notion of opportunity cost

a. True b. False

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The development of modern rich nations can be characterized by three? stages:

What will be an ideal response?

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