PRC-3 · Chapter 13 · Question 5 of 50
To accurately compare a country's actual economic growth from 2010 to 2020, economists must remove the illusion of growth caused merely by rising prices. They do this by calculating the:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Real GDP
Explanation
Real GDP is adjusted for inflation (using constant base-year prices), providing an accurate measure of actual physical output growth over time, unlike Nominal GDP.
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