wat is the difference between GDP at current prices (money GDP) and GDP at constant prices (real GDP)?? Does it make any difference which of the two is used to measure economic activity? why or why not??
guys.. pls helpppppp meeeeeeeeeeeeeeeeeeeeee...... urgent.
thx.
2007-01-14 13:19:04 · 2 answers · asked by Anonymous in Social Science ➔ Economics
Constant prices takes into account inflation and therefore is more accurate. If growth is measured at 10% in higher $$ but inflation was 10% then you have a wrong measurement saying growth was 10% when it was 0%. How much does it matter? It depends how big of an effect inflation was. No inflation then the GDP numbers are the same, high inflation and they will be very different.
2007-01-14 14:16:52 · answer #1 · answered by JuanB 7 · 0⤊ 0⤋
real gdp is most accurit
2007-01-14 14:35:36 · answer #2 · answered by todd s 4 · 0⤊ 0⤋