ECONOMICS
GDP
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which is a more accurate statistic to show how much an economy grows?
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Nominal GDP
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Real GDP
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Either A or B
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None of the above
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Explanation:
Detailed explanation-1: -Real GDP is a better indicator of economic growth because it can be compared with base year GDP.
Detailed explanation-2: -Real gross domestic product (GDP) is a more accurate reflection of the output of an economy than nominal GDP.
Detailed explanation-3: -GDP nominal can be used more statistically. In contrast, GDP PPP can be used for specific decision-making.
Detailed explanation-4: -Real GDP adjusts for inflation and is the most accurate portrait of an economy’s trajectory. By removing inflation as a variable, real GDP can tell economists if a nation’s economy is growing, shrinking, or remaining constant.
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