Macroeconomics 13th Edition by William Baumol ,Alan Blinder

Exercise 4

Suppose a worker receives a wage of $20 per hour. Compute the real wage (money wage deflated by the price index) corresponding to each of the following possible price levels: 85, 95, 100, 110, 120. What do you notice about the relationship between the real wage and the price level Relate your finding to the slope of the aggregate supply curve.