ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The term nominal gross domestic product (GDP) refers to the GDP evaluated at current market prices. Put simply, nominal GDP is the total value of all goods and services produced in a given time period less the value of those made during the production process.

Detailed explanation-2: -Nominal Gross Domestic Product (GDP) and Real GDP both quantify the total value of all goods produced in a country in a year. However, real GDP is adjusted for inflation, while nominal GDP isn’t.

Detailed explanation-3: -Nominal GDP reflects the raw numbers in current dollars unadjusted for inflation. Real GDP adjusts the numbers by fixing the currency value, thus eliminating any distortion caused by inflation or deflation.

Detailed explanation-4: -Unlike other GDP measurements, nominal GDP is not adjusted to account for price changes from inflation and deflation. It means that it rises and falls (usually rises) with the change in price and economic output in an economy.

Detailed explanation-5: -Nominal gross domestic product (GDP) is the value of all the final goods and services at current market prices. In other words, it is the GDP calculated at the current market prices. It takes into account factors such as inflation, price changes, changing interest rates, and money supply at the time of determining GDP.