Using the Chained-Dollar Method to Calculated Real GDP, Real GDP

question 93

Multiple Choice

Using the chained-dollar method to calculated real GDP, real GDP is calculated by

• A) valuing the current output at last year's real GDP prices.
• B) valuing the current output at current year prices.
• C) averaging the growth of output from one year to the next when the growth rates are calculated using this year's prices and using last year's prices.
• D) either A or C, depending which gives the larger value for real GDP.
• E) averaging the value of current output valued using base year prices and current output valued using current year prices.

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Definitions:

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