Section 3
Comparing Real and Nominal GDP
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By Boundless
By Boundless
Boundless Economics
Economics
by Boundless
2 concepts
Calculating Real GDP
Real GDP growth is the value of all goods produced in a given year; nominal GDP is value of all the goods taking price changes into account.
The GDP Deflator
The GDP deflator is a price index that measures inflation or deflation in an economy by calculating a ratio of nominal GDP to real GDP.