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Wage Determination in Perfectly Competitive Labour Markets

How wages are determined in a perfectly competitive labour market. A perfectly competitive labour market will have the following features:

·         Many firms

·         Perfect information about wages and job conditions

·         Firms are offering identical jobs

·         Many workers with same skills

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Theories of Social Goods

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Introduction Trade and Commercial Policy

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Inflation

Inflation refers to a situation where there is a continuous and persistent rise in general price level in a country. Inflation erodes the real value of money. It lead to a fall in purchasing power. Rs. 100 (nominal value) under an inflation rate of 10% is worth less than Rs. 100.

Real value is: