How do you calculate GDP at market price?

Formula: GDP (gross domestic product) at market price = value of output in an economy in the particular year – intermediate consumption at factor cost = GDP at market price – depreciation + NFIA (net factor income from abroad) – net indirect taxes.

How does real GDP work?

Real GDP starts with nominal GDP but it also factors in price changes from one period to another. Real GDP takes the total output for GDP and divides it by the GDP deflator. Let's say the current year's nominal GDP output was $2,000,000 while the GDP deflator showed a 1% increase in prices since the base year.

How does GDP affect economic growth?

Quality improvements and inclusion of new products – by not fully adjusting for quality improvements and new products, GDP understates true economic growth. For instance, although computers today are less expensive and more powerful than computers from the past, GDP treats them as the same products by only accounting for their monetary value.