Completed quickly and followed instructions given. Grammar, spelling, etc. was all good as well. Thank you so much! Will hire in the future.
Reflection paper/Reflection essay
27/08/2022
The difference is in the way both GDP are measured.
Suppose we want to differentiate between the nominal and real GDP of the United States in the year 1995.
Here are the statistics of the real GDP:
This is the GDP that includes all the inflation (usually) or deflation that a market experiences over a year.
Now, as you know, inflation is different every year so as it is a part of the nominal GDP, you can’t have a reliable way to compare a GDP of one year to some other year. Because inflation does not mean that economic growth has taken place.
So a nominal GDP is usually more than the actual GDP as the inflation increases its value.
The real GDP is the actual GDP that represents the actual economic growth that happened as it is without the affects of inflation.
So usually, a GDP figure (nominal GDP) has a high value because of the effect of inflation.
So to come to the lower value of the real GDP, the nominal GDP value is deflated (decreased) by a tool known as the GDP Deflator .
This enables us to compare the GDP of one year to other years.
Note: The GDP Deflator works by taking one year as the base year. This can be taken at random.
The value of the base year’s nominal GDP is taken. Then the GDP of all other years are compared to the GDP value of the base year.
So the GDP of all other years when passed through a GDP Deflator become the real GDP.
In the case above, the real GDP of 1995 is approximately $10 trillion. But the nominal GDP is obviously higher than this as inflation will be added to it.
And in the statistics above, the base year is 2009.
So for example, if the base year is chosen to be 1970, then the statistics of the real GDP will not be exactly the same.
Completed quickly and followed instructions given. Grammar, spelling, etc. was all good as well. Thank you so much! Will hire in the future.
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.
Read moreEach paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.
Read moreThanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.
Read moreYour email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.
Read moreBy sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.
Read more