Real GDP is calculated in a way such that goods and services are evaluated at some constant set of prices. Since these prices remain fixed, if the Real GDP changes, we can be sure that it is the volume of production which is undergoing changes. Nominal GDP, on the other hand, is simply the value of GDP at the current prevailing prices.
Which G.D.P. is the indicator of growth and development of a country?
Real G.D.P.
The correct answer is **Real G.D.P.**.
- **Real GDP** is the best indicator of a country’s economic growth because:
- It measures actual production levels by adjusting for inflation.
- It provides a clearer picture of economic progress over time.
- **(a) Nominal GDP** → Incorrect, as it includes price fluctuations.
- **(b) National Income** → Incorrect, as it includes income from abroad.
- **(d) Domestic Income** → Incorrect, as it is a broad term and not specifically used for growth analysis.
Important Questions from National Income and Related Aggregates
Match List-I with List-II:
List-I List-II (A) ΔC/ΔY (I) APS (B) S/Y (II) MPS (C) ΔS/ΔY (III) APC (D) C/Y (IV) MPC Choose the correct answer:
Central Pollution Control Board (CPCB) has identified ______ categories of large and medium industries as polluting industries.
Match List-I with List-II:
List-I List-II (A) Ex-ante saving (I) Actual Saving (B) Ex-post consumption (II) Planned Saving (C) Ex-ante consumption (III) Planned Consumption (D) Ex-post saving (IV) Actual Consumption Identify the Stock variable/variables:
A. Income
B. Output
C. Capital
D. Profits
E. Money SupplyA firm buys a machine for ₹55 lakhs. The expected life of the machine is ten years. The annual depreciation of the machine is:
