How does one calculate the real GDP for two (2) goods and services?
1 Answer
Jan 6, 2016
The basic concept is not considering price variations in your calculation.
Explanation:
The term "real" in Economics refers to the actual value, not the nominal one, which is the one at tag prices. Finding the real GDP for two goods and services is a nice illustration of how the economy grows.
To calculate it, you'll need to keep prices constant at one year, which will be your base-year. Then, holding it constant, you just multiply it by the quantities for each product in each year.
