Real national income
Definition. Real national income is the total income earned by the factors of production in an economy over a period, measured at constant prices so that the effect of inflation is removed. It reflects the actual quantity of goods and services produced rather than their money value.
Real national income is obtained by adjusting nominal national income for changes in the price level, allowing genuine comparisons of economic activity and living standards across different time periods.
This term belongs to National Income and GDP in A Level Economics. Read the full chapter for the diagrams, worked examples and exam technique.
Want to use real national income for marks in the exam? Learn it in class or message the team.