Real GDP- the value of GDP in the base year prices.Takes out inflation. Real GDP per Capita looks at the amount produced per person. Takes the quantity in one year and multiples by the price of a base year. Nominal GDP- the value of GDP in current year prices.does not take out inflation. Takes the quantity of one year and multiplies by the price of that year.
Real GDP- the value of GDP in the base year prices.Takes out inflation. Real GDP per Capita looks at the amount produced per person. Takes the quantity in one year and multiples by the price of a base year.
Nominal GDP- the value of GDP in current year prices.does not take out inflation. Takes the quantity of one year and multiplies by the price of that year.
Example
2011 Nominal GDP: 20*12+30*6=$420
2011 Real GDP: 20*10+30*5=$350
(350-175=175) $175 increase in sales
(350-420=70) $70 increase in prices
Dr. Stephanie Powers, "Economic Growth".(Lecture, Donald School of Business, Red Deer Alberta, Winter 2012)