ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Real gross domestic product (GDP) is an inflation-adjusted measure that reflects the value of all goods and services produced by an economy in a given year. Real GDP is expressed in base-year prices. It is often referred to as constant-price GDP, inflation-corrected GDP, or constant dollar GDP.

Detailed explanation-2: -Key Takeaways. Nominal GDP is the total value of all goods and services produced in a given time period, usually quarterly or annually. Real GDP is nominal GDP adjusted for inflation. Real GDP is used to measure the actual growth of production without any distorting effects from inflation.

Detailed explanation-3: -Real gross domestic product (real GDP) is a macroeconomic measure of the value of economic output adjusted for price changes (i.e. inflation or deflation). This adjustment transforms the money-value measure, nominal GDP, into an index for quantity of total output.

Detailed explanation-4: -Economists calculate real GDP by then adjusting the resulting nominal GDP to account for inflation by applying a GDP deflator or a price index, which measures inflation since the base year. In this case, the base year is a year separate from the one under study, but whose prices will be used to measure it.