How to find real GDP gross domestic product - AP Macroeconomics

Card 1 of 11

0
Didn't Know
Knew It
0
1 of 1110 left
Question

In a certain year, nominal gross domestic product grew by 8 percent. The inflation rate was 4 percent. Real gross domestic product for this year was               .

Tap to reveal answer

Answer

Nominal GDP growth refers to the rate at which real GDP increases. To find real GDP growth (i.e. GDP growth that accounts for inflation), subtract the inflation rate from the nominal GDP growth rate.

In this case, the nominal GDP growth rate is 8 percent, and the inflation rate is 4 percent. Thus, the real GDP growth rate is 4%.

← Didn't Know|Knew It →