Growth rates may be worked out by using year-to-year changes in the value of GDP. Why is real GDP per head regarded as a better indicator than nominal GDP per head for this calculation?
- AReal GDP adjusts for price changes by using a base year.
- BReal GDP ignores the effects of fluctuations in exchange rates on purchasing power.
- CReal GDP includes changes in the size of the population.
- DReal GDP measures GDP at factor cost rather than market prices.