What does nominal GDP mean?

Okay, so you want me to explain “Nominal GDP” like I’m chatting with a friend, right? Got it! Here’s my take:

“Okay, so what’s nominal GDP all about? Well, basically, it’s like… imagine you’re adding up everything a country makes in a year – all the gadgets, the haircuts, the food, you name it. Nominal GDP is the total value of all that stuff, okay?

Here’s the thing, though – it’s calculated using today’s prices. So, if bread costs $3 a loaf this year, we use $3 for the calculation. Think of it like this: I remember back in the day, a candy bar was, like, a quarter, right? If we were calculating GDP back then, that candy bar would only add 25 cents to the total! But now it’s probably, what, a dollar or more?

And because it uses today’s prices, that means inflation isn’t taken into account. So, if prices go way up – like, everything gets more expensive – nominal GDP might look like it’s growing like crazy, even if we’re not actually making more stuff. Does that make sense? It can be kinda misleading, right?”