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24 September, 05:11

Why is real GDP a more accurate measure of an economy's production than nominal GDP?

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  1. 24 September, 05:19
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    The answer for the following question is given below:

    Explanation:

    Nominal GDP is the price, inflation-unadjusted for, goods and services produced in a country. Real GDP is a nominal GDP, calculated to reflect changes in aggregate demand for inflation.

    Real GDP is a more accurate indicator of the output of a country than nominal GDP since real GDP calculates the value of the product and services generated by an economy while nominal GDP calculates the price of the product and services consumed by an economy.
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