Question

What is so "real" about RGDP and do you think it really matters whether you know it or not?

Answer 1

Real GDP measures the volume of output adjusted for inflation in the economy and is measured at some (constant) prices from a base year.

Nominal GDP is the value of the national output at the current prices without any adjustment for fluctuations in the price level in the economy.

Real in RGDP thus gives us the true value of the national product in the economy and not the over- estimates nominal value. It does matter because the real GDP depicts the true economic growth in the economy which is also a determinant of the economic development in the economy.