Nominal GDP is: A. GDP adjusted for inflation B. GDP measured in current prices C. GDP adjusted for population size D. GDP measured in constan
Question
Nominal GDP is:
- A. GDP adjusted for inflation
- B. GDP measured in current prices
- C. GDP adjusted for population size
- D. GDP measured in constant
Solution
Nominal GDP is B. GDP measured in current prices.
Here's why:
Nominal GDP refers to the economic output of a country, but it doesn't account for inflation. It's calculated using the current market prices for goods and services produced. This is why it's also known as "current dollar GDP" or "chained dollar GDP."
On the other hand, GDP adjusted for inflation is known as real GDP (not option A). GDP adjusted for population size is GDP per capita (not option C). And GDP measured in constant prices is also referring to real GDP (not option D).
So, the correct answer is B. GDP measured in current prices.
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