Question

When nominal gdp is 840 and price index is 120 ,real gdp will be ?

Answer 1

Explanation:

Values for real GDP are adjusted for differences in prices levels, while figures for nominal GDP are not. The GDP Price Index is an indicator for inflation calculated by comparing the current GDP to GDP in the reference year. To find real GDP we divide the nominal GDP by this price index.

Answer 2

Real GDP = 700

Explanation:

Given:

Nominal GDP = 840

Price index = 120

Find:

Real GDP

Computation:

⇒ Real GDP = [Nominal GDP / Price index]100

⇒ Real GDP = [840 / 120]100

⇒ Real GDP = [7]100

Real GDP = 700

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