ECONOMICS
BUSINESS CYCLES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Excludes government debt
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Excludes exports
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Is adjusted for price-level changes using a price index
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Measures only the value of intermediate goods and services that are consumed
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Measures the prices of a market basket of goods purchased by a typical consumer
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Detailed explanation-1: -What Is the Difference Between Nominal and Real GDP? In short, nominal GDP measures the economic production at current market prices, whereas real GDP measures the economic production factoring in any prices changes in the market (deflation or inflation).
Detailed explanation-2: -Nominal GDP measures output using current prices, while real GDP measures output using constant prices.
Detailed explanation-3: -To determine “real” GDP, its nominal value must be adjusted to take into account price changes to allow us to see whether the value of output has gone up because more is being produced or simply because prices have increased.
Detailed explanation-4: -real GDP also includes services, whereas nominal GDP only takes goods into account.