Under which condition does the real wage of workers fall?

When prices rise faster than wages

Real wage means the purchasing power of a worker’s money income, not simply the numerical amount written on a pay slip. If wages rise by 5 percent but the prices of food and other necessities rise by 10 percent, the worker can buy less than before; in that situation real wages fall. This is why rapid inflation can create hardship even when nominal wages remain unchanged or increase slightly. Cheaper bread would improve purchasing power, and a rapid wage rise could increase it if prices did not rise more quickly. The ending of taxes is a separate issue. Therefore option A is correct.

This is a Class 9 History question. Chapter: The French Revolution. Topic: French Society During the Late Eighteenth Century.