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How to Calculate Real Income

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In this brief video we’re going to learn how to calculate what is known as “real income.” Real income adjusts for inflation and is a better gauge of purchasing power than ordinary income. Below is the question we’ll be solving in this video if you’d like to follow along. “If your income increased from $23,000 to $26,000 during a period when the rate of inflation was 4 percent, your real income after the raise was __________.”
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Text Comments (3)
alisher supygaliyev (1 month ago)
24000/1.04=23076 ROFL Nice mistake there D:
alvaro gonzalez (3 months ago)
How do we get to 1.04 from 0.04? Dont get that part
You add 1 to the interest rate after converting it into decimal form.

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