Nominal GDP is a better measure of the growth in production than real GDP is.

Question

Quizplus · Accepted Answer

Nominal GDP is calculated using current market prices and therefore includes the effects of inflation. Real GDP, on the other hand, is adjusted for inflation and represents the value of goods and services produced in constant dollars. Real GDP is a better measure of growth in production because it shows the changes in the quantity of goods and services produced, rather than changes in prices.

Nominal GDP Is a Better Measure of the Growth in Production