What do you understand by real and nominal GDP?

GDP refers to the sum of all the goods and services that is produced in an economy in a defined financial year.

Real GDP is obtained by multiplying the price of the base year which is pre decided and fixed with the quantity of the current year. Since there is a base year it helps the economy get an understanding on the inflation rate and hence reflects the real growth.

Nominal GDP is obtained by multiplying the price of the current year with the quantity of the current year. Since it takes current year values hence, we cannot obtain the inflation or the real growth of the economy.