Real GDP and nominal GDP differences
Not what you're looking for?
What is the difference between real GDP and nominal GDP? Which is the better measure of economic well-being, and why?
Purchase this Solution
Solution Summary
The expert examines real GDP and nominal GDP differences.
Solution Preview
Let me make this as simple as possible.
GDP stands for Gross Domestic Product, and does not count overseas investments (that would be Gross National Product).
Nominal versus Real:
Nominal GDP uses present-day prices. If inflation is pushing prices up, then this is counted in the nominal figure. But if the dollar is inflated in value, the nominal GDP would be a false reading. The dollar has lost value.
Real GDP tries to compensate for nominal 'false readings' by using a base year. That means it will use prices that were in effect in 2000 or something to have a measure from which to compare economic development in 2012. ...
Purchase this Solution
Free BrainMass Quizzes
Pricing Strategies
Discussion about various pricing techniques of profit-seeking firms.
Elementary Microeconomics
This quiz reviews the basic concept of supply and demand analysis.
Basics of Economics
Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.
Economic Issues and Concepts
This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.
Economics, Basic Concepts, Demand-Supply-Equilibrium
The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.