If you subtract the Real GDP Growth rate from the Nominal Growth Rate, what will this indicate?
2007-03-25 17:40:02 · 4 answers · asked by Karolina12 1 in Social Science ➔ Economics
the rate of inflation. Nominal GDP is the amount of the GDP without considering the inflation rate at that time. While real GDP use inflation rate to consider so you can compare the growth from time to time more accurate.
2007-03-26 03:00:35 · answer #1 · answered by szeplany 2 · 0⤊ 0⤋
Real GDP is the same as Nominal GDP adjusted for Inflation. Real GDP is a better indicator of economic growth (since it only measures actual economic growth). Inflation can make Nominal GDP large even though it could easily be caused by inflation.
2016-03-29 06:08:08 · answer #2 · answered by Anonymous · 0⤊ 0⤋
The rate of inflation?
The difference between real and nominal is that real has th effects of inflation factored in. If nominal GDP grew 10% and inflation was 10% over the same period, real GDP would be the same.
2007-03-25 17:46:25 · answer #3 · answered by Buying is Voting 7 · 1⤊ 0⤋
real gdp*deflator=nominal gdp
ln real gdp + ln deflator = ln nominla gdp
but ln real gdp is real gdp growth rate, so is the same...
and deflator could be interpretted as inflation...
so it would be inflation rate...
2007-03-25 19:26:24 · answer #4 · answered by ilhongy 2 · 0⤊ 0⤋