Insert the information in the form and the calculator will determine the GDP deflator.
What is the GDP deflator?
the GDP deflator is a measurement of changes in the prices of all the products produced within a country's economy to eventually measure the true economic state of the economy. Essentially the GDP deflator removes the inflation from a country's gross domestic product (GDP) in order to isolate the underlying productivity component.
How to calculate GDP deflator?
To calculate GDP deflator you should use the following formula:
GDP deflator = (nominal GDP / real GDP) * 100
example: In 2022 an economy had a nominal GDP of $64,000,000,000 and the real GDP was the same, calculate the GDP deflator?
Using the earnings pershare formula the answer will be:
GDP deflator = (nominal GDP / real GDP) * 100
GDP deflator = ($64,000,000,000 / $64,000,000,000) * 100
GDP deflator = 100%
Why use GDP deflator?
The GDP deflator is usualluy used by companies to adjust the payments in contracts.