Question
Consider the following statements regarding ‘GDP Deflator’:
Select the correct answer using the code given below:
- It is an index of the price which is calculated as the ratio of nominal GDP to real GDP
- The weights differ according to the production level of each good in the GDP deflator
Select the correct answer using the code given below:
Answer: Option A
Answer: (a)
The GDP deflator is an index of price and measures the price changes quarterly.
GDP deflator = nominal GDP/real GDP
CPI and WPI indices are calculated by fixing the weights of different goods and services but in case of the GDP deflator, it varies as per actual production level.
(Its highly technical, if you don’t understand, leave it, will provide a video)
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Answer: (a)
The GDP deflator is an index of price and measures the price changes quarterly.
GDP deflator = nominal GDP/real GDP
CPI and WPI indices are calculated by fixing the weights of different goods and services but in case of the GDP deflator, it varies as per actual production level.
(Its highly technical, if you don’t understand, leave it, will provide a video)
Was this answer helpful ?
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