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Why in 1996 did the BEA switch to calculate real GDP using the "chained-dollar method" from the "constant-dollar method"?
The BEA made the switch from the constant-dollar method to the chained-dollar method, because the latter has enhanced the accuracy of the GDP growth calculations by yielding one unique estimated growth rate among any two years. With the constant-dollar method, the growth estimate depends on which year is used as the base year.
Production Process: Production is a process that transforms factors of production or inputs into output of goods and services. Production may be classified into extraction, ma
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