Question

Gross Domestic Product that is adjusted for price changes is called _____.

A. nominal Gross Domestic Product
B. real Gross Domestic Product
C. inflation

Answer 1

The correct answer is B) real Gross Domestic Product.

Gross Domestic Product that is adjusted for price changes is called real Gross Domestic Product.

In economics, if we want to measure economic output that affects variables such as inflation or deflation, we use real Gross Domestic Product. It is different from the nominal Gross Domestic Product in that the real gives us a more realistic evaluation of growth. And that is an advantage to be considered.

Answer 2

Answer: B: real Gross Domestic Product

Gross Domestic Product that is adjusted for price changes is called real Gross Domestic

Explanation:

Real Gross Domestic Product measures the changes in the general price level of all goods and services produced by an economy in a year using base-year prices which is referred to as inflation-corrected or constant-price. It provides an accurate figure of economic growth and account for changes in the general price level.