Economics
Intermediate

Real GDP

Output adjusted for inflation, so growth reflects real production, not rising prices.

Formula

Real GDP=Nominal GDPDeflator×100Real\ GDP = \dfrac{Nominal\ GDP}{Deflator}\times 100

Variables

Real GDPInflation-adjusted output
Nominal GDPCurrent-price output
DeflatorGDP price index

Example

$660B / 110 × 100 = $600B

Did You Know?

Comparing real rather than nominal GDP prevents mistaking pure inflation for genuine economic growth.

gdprealdeflator