How Does GDP Adjust for Inflation?

Real g d p adjusts for inflation, and also lets us make comparisons over time about how much actual stuff we're producing without inflation clouding things. When you and i buy stuff, it's called consumption spending. When businesses spend money on machines and the like, we call it investment. And when the government spends money on our behalf, it is called government spending. The final source of spending is that foreigners sometimes buy our stuff adwe call that exports. In fact, g d p counts our exports minus our imports. This gets tricky, but i don't want you to think that this is because imports subtract from g d p, because they don't.