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Real Vs. Nominal GDP
A distinction between Nominal GDP and
Real GDP allows us to measure the actual
changes in production, separate and apart
from any price changes that may have
occurred in the economy during the year.
Real Vs. Nominal GDP
 Nominal
GDP:
The total market value of all the final goods and
services produced within an economy in a given
year. The value of GDP in current dollar.
 Real
GDP:
A measure of GDP that adjusts for changes in
prices. The value of GDP in constant dollar.
GDP Deflator
An index that measures how
the prices of goods included in
GDP change over time.