Real Gross Domestic Product: It is the total of the value of the goods and services calculated at constant price levels.
Nominal Gross Domestic product: It is the total of the value of the goods and service calculated at a current price level.
Detailed Answer:
Basis for Comparison |
Nominal GDP |
Real GDP |
Meaning |
The aggregate market value of the economic output produced in a year within the boundaries of the country is known as Nominal GDP |
Real GDP refers to the value of economic output produced in a given period adjusted according to the changes in the general price level. |
What is it? |
GDP without the effect of inflation. |
Inflation-adjusted GDP |
Expressed in |
Current year prices. |
Base year prices or constant prices. |
Valueuses |
Higher Comparison of various quarters of the given year can be made. |
Generally lower. Comparison of two or more financial year can be done easily. |
Economic Growth |
Cannot be analyzed easily. |
Good indicator of economic growth. |