gs1medium
With reference to India economy, consider the following statements:
- 1.The rate of growth of real Gross Domestic Product has steadily increased in the last decade.
- 2.The Gross Domestic Product at market prices (in rupees) has steadily increased in the last decade.
Which of the statements given above is/are correct?
- A.1 only
- B.2 only
- C.Both 1 and 2
- D.Neither 1 nor 2
▶ Answer & Explanation
Correct answer: B. 2 only
Nominal GDP, which is GDP at market prices in current rupees, tends to increase over time due to inflation and economic expansion. However, real GDP growth, which accounts for inflation, can fluctuate significantly year to year and has not shown a steady upward trend over the last decade; it experienced periods of slowdown and recovery. Therefore, only the statement about the steady increase in nominal GDP is consistently true.
Source: UPSC gs1 2015