Valuing the quantities of goods produced in consecutive years using prices in both years and then averaging the percentage changes in the value of output is part of the method of calculating real GDP.
A) moving-base-year
B) chain-weighted output index
C) base-year
D) fixed quantities/variable prices

Question

Quizplus · Accepted Answer

The described method involves using both current and previous year prices to value output, which is the basis for chain-weighted output index. This method is an improvement over the traditional fixed base year approach, which can potentially overstate or understate changes in output due to shifts in prices.

Valuing the Quantities of Goods Produced in Consecutive Years Using