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Why does real GDP equal nominal GDP divided by CPI for the given year?


Because the actual production is equal to the aggregate demand.


Because one must factor out any price changes in the value of the economy to enable true (or real) GDP comparisons.


Because nominal GDP does not include inflation it must factored in to calculate real GDP.


Because aggregate supply is the same as CPI. Therefore, if one divides nominal GDP by aggregate supply one will know the real GDP.


Because nominal GDP is the same as the level of consumption. So when one factors price changes out of the consumption level then real gross domestic production becomes obvious.

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