ECONOMICS
INFLATION
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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If the GDP deflator were 200 in 2010 and goes up to 260 in 2011, the inflation rate calculated in 2011 would be 35 percent
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True
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False
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Either A or B
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None of the above
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Explanation:
Detailed explanation-1: -A price deflator of 200 means that the current-year price of this computing power is twice its base-year price-price inflation. A price deflator of 50 means that the current-year price is half the base year price-price deflation.
Detailed explanation-2: -Inflation rate is just the percentage change in GDP deflator from one period to the next. Mathematically, we can write it as GDP deflator of year 2 subtracted by GDP deflator of year 1, divided by GDP deflator of year 1, and then multiplied by 100.
Detailed explanation-3: -Nominal GDP from 2010 to 2011 has increased by 23 percent and the Nominal GDP from 2011 to 2012 has increased by 19.23 percent.
There is 1 question to complete.