Part 1 Expenditures Approach Calculating Gdp

Presentation of Information 2012 Q32012 Q42013 Q12013 Q2Nominal GDP1635616420.316535.316667.9Real GDP1553415539.615583.915681b) AnalysisNominal GDP is greater than Real GDP because it does not adjust for inflation. In case of Real GDP the amount of GDP is adjusted is for the current prevailing inflation rate in the economy. There can be cases when nominal GDP of the country is very high but the best comparative framework between economies can only be arrived when the numbers are adjusted for inflation. As from the data given above we can see that U.S. is growing steadily both in terms of nominal and real GDP. Inflation in the U.S. economy is pretty low and hence the impact of the same is visible in numbers. As we can see from the graph above, it suggests how economy has grown over the quarters. It shows that difference between nominal GDP and real is very steep in 2012 Q4, this may be on account of higher inflation in the economy. We can further see that in the second quarter of 2013, growth numbers are good and the