Real GDP

Real GDP can be calculated using either price or quantity indexes.

Using Quantity Indexes

Real GDP = {Nominal GDP}_{b a s e y e a r} \times \frac{{CPI}_{c u r r e n t y e a r}}{{CPI}_{b a s e y e a r}}

Using Price Indexes (The Deflation Approach)

Real GDP = \frac{{Nominal GDP}_{c u r r e n t y e a r}}{{Price Index}_{c u r r e n t y e a r}}

Real GDP in Canada

The real GDP in dollars of 2012 (solid black line) is higher than real GDP in dollars of 2007 (blue dashed line) simply because most prices were higher in 2012
The cyclical component of real GDP is almost exactly identical between 2007 and 2012
Since we used the log-scale in the above graph, it is easy to conclude that the growth rate of real GDP has been decreasing between 1961 and 2020

The growth rates of the low frequency component are also nearly identical between 2007 and 2012