Question

Define GDP deflator during 2013 the normal value of gdp in india was rs 7,000 crores during the same year the gdp of the country evaluted at price of some base year was rs 6,000 cr. Find the value of gdp deflator of the year in percentage terms

Answer 1

Answer:

The GDP deflator, also called implicit price deflator, is a measure of inflation. It is the ratio of the value of goods and services an economy produces in a particular year at current prices to that of prices that prevailed during the base year.

This ratio helps show the extent to which the increase in gross domestic product has happened on account of higher prices rather than increase in output.