Asked by Paula Izquierdo on Jul 03, 2024
Verified
The GDP deflator is the ratio of
A) real GDP to nominal GDP multiplied by 100.
B) real GDP to the inflation rate multiplied by 100.
C) nominal GDP to real GDP multiplied by 100.
D) nominal GDP to the inflation rate multiplied by 100.
GDP Deflator
An economic metric that converts output measured at current prices into constant-dollar output by adjusting for inflation.
Nominal GDP
Gross Domestic Product measured in current prices without adjusting for inflation, representing the total value of all goods and services produced over a specific time period within a country's borders.
Real GDP
The calculation of a nation's total economic production factoring in adjustments for price fluctuations, either inflationary or deflationary.
- Contrast real values against nominal ones in the context of economic metrics.
Verified Answer
ZK
Zybrea KnightJul 05, 2024
Final Answer :
C
Explanation :
The GDP deflator is calculated by dividing nominal GDP by real GDP and then multiplying by 100. This measures the level of prices of all new, domestically produced, final goods and services in an economy.
Learning Objectives
- Contrast real values against nominal ones in the context of economic metrics.