Real GDP

Real GDP

Real GDP is a macroeconomic measure of the size of an economy adjusted for price changes and inflation.

Real GDP measures the output of final goods and services produced, and incomes earned at constant prices. Real GDP = [(Nominal GDP)/(GDP deflator)] x 100

Real GDP for a given year is the given year's nominal GDP stated in the based-year price level. Real GDP growth on an annual basis is the nominal and abnormal GDP growth rate adjusted for inflation and expressed as a percentage.

Because Real GDP is adjusted for changes in prices and inflation throughout the year, it can be thought of in terms of 'purchasing power.'

Real GDP per Capita reflects GDP purchasing power of each individual in the economy.

Real GDP per capita is found by dividing real GDP by the size of the population.

ee also

* Real versus nominal value

Wikimedia Foundation. 2010.

Look at other dictionaries:

  • real GDP — inflation adjusted measure of gross domestic product. Bloomberg Financial Dictionary * * * real GDP UK US noun [U] ► ECONOMICS, FINANCE the total value of goods and services produced in a country in a particular year, taking inflation into… …   Financial and business terms

  • Real income — is the income of individuals or nations after adjusting for inflation. It is calculated by subtracting inflation from the nominal income. Real variables, such as real income, real GDP, and real interest rate are variables that are measured in… …   Wikipedia

  • Real versus nominal value (economics) — Economics …   Wikipedia

  • GDP deflator — In economics, the GDP deflator (implicit price deflator for GDP) is a measure of the change in prices of all new, domestically produced, final goods and services in an economy. GDP stands for gross domestic product, the total value of all final… …   Wikipedia

  • Real Gross Domestic Product (GDP) — An inflation adjusted measure that reflects the value of all goods and services produced in a given year, expressed in base year prices. Often referred to as constant price , inflation corrected GDP or constant dollar GDP . Unlike nominal GDP,… …   Investment dictionary

  • GDP Deflator —    A price index applied to the cash or nominal estimates of gross domestic product in order to produce a more accurate or real value of GDP. Deflators remove the effects of inflation, which boosts the nominal value of GDP but does not change the …   Financial and business terms

  • Real bills doctrine — Economics …   Wikipedia

  • Real interest rate — The real interest rate is approximately the nominal interest rate minus the inflation rate (see Fisher equation and below for exact equation). Since the inflation rate over the course of a loan is not known initially, volatility in inflation… …   Wikipedia

  • Real wage — The term real wages refers to wages that have been adjusted for inflation. This term is used in contrast to nominal wages or unadjusted wages.The use of adjusted figures is in undertaking some form of economic analysis. For example, in order to… …   Wikipedia

  • Real Economic Growth Rate — A measure of economic growth from one period to another expressed as a percentage and adjusted for inflation (i.e. expressed in real as opposed to nominal terms). The real economic growth rate is a measure of the rate of change that a nation s… …   Investment dictionary

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.