Real GDP is the
A)Value of final output produced,adjusted for changing prices.
B)Value of final output produced,measured in current prices.
C)Income earned by current factors of production.
D)GDP minus depreciation.

Question

Quizplus · Accepted Answer

Real GDP takes into account changes in prices, so that it reflects the actual changes in output produced. This is different from nominal GDP (which is option B), which is just the value of final output produced measured in current prices, without any adjustment for changes in prices. Option C is referring to national income, which is also different from GDP. Option D refers to net domestic product, which is not the same as GDP.

Real GDP Is the