Calculating the US Nominal Wage Index (2010-2012)

An economic analyst is creating a wage index for a country. In the base year, 2020, the average weekly wage was $800. In 2021, the wage increased to $824. In 2022, the wage increased by an additional 2% from the 2021 level. What is the wage index for 2022, using 2020 as the base year?

Review of a Nominal Wage Index Calculation

Procedural Error in Index Construction

You are tasked with constructing a nominal wage index from a dataset of annual wages. Arrange the following steps in the correct chronological order.

In a country's economic data, the nominal wage index was 110 in the year 2020 and rose to 115 in the year 2021. The base year for this index is 2015. Which of the following statements most accurately describes the change in average nominal wages between 2020 and 2021?

An economic report shows that a nominal wage index was 112.0 in the year 2020 and rose to 115.36 in 2021. If the average nominal wage in 2020 was $800, what was the average nominal wage in 2021?

Impact of Base Year Selection on a Nominal Wage Index

True or False: When constructing a nominal wage index, the index for any given year is always calculated by finding the percentage difference between that year's wage and the base year's wage, and then applying this percentage to the base index value of 100.

You are an economist analyzing annual wage data. Match each scenario describing a year's nominal wage data with the correct resulting wage index value, based on the standard method for constructing such an index.

Interpreting Changes in a Nominal Wage Index

Figure 1.6: US Nominal Wage Index (2010–2022)

Similarity in Constructing CPI and Nominal Wage Index