Using the chained-dollar method to calculate real GDP,real GDP is calculated by
A)valuing the current output at last year's real GDP prices.
B)valuing the current output at current year prices.
C)averaging the growth of output from one year to the next when the growth rates are calculated using this year's prices and using last year's prices.
D)either A or C,depending which gives the larger value for real GDP.
E)averaging the value of current output valued using base year prices and current output valued using current year prices.

Question

Quizplus · Accepted Answer

The chained-dollar method calculates real GDP by averaging the growth rates of output using both the current year's prices and the previous year's prices, providing a more accurate measure of real GDP over time.

Using the Chained-Dollar Method to Calculate Real GDP,real GDP Is