HomeQuestionsEconomicsCalculating Real GDP per Capita
📚 Learning Guide
Calculating Real GDP per Capita
easy

What is the formula for calculating Real GDP per Capita using Nominal GDP?

Master this concept with our detailed explanation and step-by-step learning approach

Learning Path
Learning Path

Question & Answer
1
Understand Question
2
Review Options
3
Learn Explanation
4
Explore Topic

Choose the Best Answer

A

Real GDP = Nominal GDP / Population

B

Real GDP = Nominal GDP * Population

C

Real GDP per Capita = Nominal GDP + Population

D

Real GDP per Capita = Nominal GDP - Population

Understanding the Answer

Let's break down why this is correct

Answer

To calculate Real GDP per Capita using Nominal GDP, you start by understanding what these terms mean. Nominal GDP measures the total value of all goods and services produced in a country at current prices, without adjusting for inflation. To find Real GDP, which reflects the true value by accounting for inflation, you divide the Nominal GDP by the GDP deflator, which is a measure of price changes. Once you have Real GDP, you can find Real GDP per Capita by dividing the Real GDP by the population of the country. For example, if a country's Nominal GDP is $1 trillion, the GDP deflator is 1.

Detailed Explanation

To find Real GDP per Capita, you divide the total Nominal GDP by the number of people. Other options are incorrect because This option suggests multiplying, which means you think each person adds to the total GDP; Adding Nominal GDP and population mixes two different things.

Key Concepts

Nominal GDP
Topic

Calculating Real GDP per Capita

Difficulty

easy level question

Cognitive Level

understand

Ready to Master More Topics?

Join thousands of students using Seekh's interactive learning platform to excel in their studies with personalized practice and detailed explanations.

Start Learning with SeekhExplore More Calculating Real GDP per Capita Questions