Nominal Wage and Real Wage represent wages from different perspectives.

  Nominal wages are the total amount of wages received by workers, representing the face value without considering inflation or changes in prices. For example, this includes the cash amount received as monthly salary or bonuses.

  Real wages represent wages that show how much purchasing power they actually have after subtracting inflation and other price increases from nominal wages. When prices rise, the same nominal wage will buy fewer goods and services.

  Even if nominal wages increase each year, if the inflation rate is higher than that, real wages may decrease, potentially leading to a more difficult standard of living. Therefore, price fluctuations are an important factor to consider alongside wage increases.