Interpreting Real GDP (module 15)

aggregate output

the total quantity of final goods and services the economy produces

Real GDP

the total value of the final goods and services produced in the economy in a given year, calculated using the prices of a selected base year

nominal GDP

the value of all final goods and services produced in the economy during a given year, calculated using the prices current in the year in which the output is produced

chained dollars

the method of calculating changes in real GDP using the average between the real GDP growth rate calculated on an early base year and the GDP growth rate calculated on a late base year

GDP per capita

average GDP per person; not by itself an appropriate policy goal because there is not a one-to-one match between GDP and the quality of life