Question:

Why is there a difference between GDP and real GDP? details below?

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the imaginary island of Morania has a GDP of $12,000 and a real GDP of $10,000.

explain plz

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  1. It means that difference were because of changes in price level, or inflation was

    100*(12'000-10'000)/10'000= 20% from initial base-period.

    If population is 500 people then per capita real GDP is $10'000/500= $20

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