Asked by
Mirna Ayach
on Nov 16, 2024
Verified
If the GDP deflator in 2009 was 160 and the GDP deflator in 2010 was 180, then the inflation rate in 2010 was 12.5%.
Inflation Rate
A rate, described in percentages, indicating how prices for various goods and services are climbing, which in turn decreases the value of money.
GDP Deflator
A measure of the level of prices of all new, domestically produced, final goods and services in an economy, used to deflate or adjust the nominal GDP to real GDP.
- Understand the fundamentals of inflation, the reasons behind its development, and its connection to GDP and the GDP deflator.
Verified Answer
NB
Learning Objectives
- Understand the fundamentals of inflation, the reasons behind its development, and its connection to GDP and the GDP deflator.