How do you calculate the growth rate of real GDP between two years?
[GDP(yr. 2)-GDP(yr. 1)]/GDP(yr. 1)
Convert that fraction to %
The GDP deflator (published by the Dept of Commerce) must be applied to the actual GDP to get real GDP
http://cost.jsc.nasa.gov/inflateGDP.html
To calculate the growth rate of real GDP between two years, you can follow these steps:
Step 1: Obtain the values of real GDP for both years. Real GDP is a measure of economic output adjusted for inflation.
Step 2: Subtract the initial year's real GDP from the final year's real GDP.
Step 3: Divide the difference by the initial year's real GDP.
Step 4: Multiply the result by 100 to convert it into a percentage.
Step 5: This percentage represents the growth rate of real GDP between the two years.
To calculate the growth rate of real GDP between two years, you need the GDP figures for both years.
Here's the step-by-step process:
1. Find the real GDP for each year: Real GDP captures the value of economic output adjusted for inflation. You can usually find real GDP data from government statistical agencies or economic databases.
2. Subtract the real GDP of the first year from the real GDP of the second year: Subtract the value of real GDP in the first year from the value of real GDP in the second year. This will give you the difference in real GDP between the two years.
3. Divide the difference by the real GDP of the first year: Take the difference you calculated in step 2 and divide it by the real GDP of the first year. Multiply the result by 100 to convert it into percentage form.
4. Multiply the result by 100: This step is optional but often done to convert the growth rate into a percentage. This will give you the percentage change in real GDP between the two years.
The formula to calculate the growth rate of real GDP between two years is:
Growth rate = ((Real GDP in Year 2 - Real GDP in Year 1) / Real GDP in Year 1) * 100
By following these steps and plugging in the appropriate values, you can calculate the growth rate of real GDP between any two years.