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Economics A Level

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Question:

What is the Difference between Nominal GDP and Real GDP? Why does it even matter?

Author: go kys



Answer:

-Nominal GDP is the GDP Figure that hasn’t been Adjusted for Inflation, while Real GDP is when Inflation has been Accounted for -This is Important as since GDP is the VALUE of the Goods and Services, so Inflation can Impact it [Make the Value go Up] but this doesn’t mean the Economy is actually Growing. -So if the Real GDP is Negative, but Nominal is Positive, there may be just very High Inflation


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go kys
go kys