Random article: How to calculate GDP Deflator
GDP deflator is the ratio of nominal GDP to its base value, which, as a rule, is expressed as percentage. This term was introduced because of necessity of a correct correlation of GDP figures for different periods of year under conditions of sharp change of structure of prices. As a result, GDP can be calculated in current prices, and this value is accepted as nominal. Also GDP can be calculated in prices of a certain year taken as basic, and resulted value is known as basic (or real).
In the USA 1996 year is used as the basic.
Thus, we get formula:
GDP deflator = Nominal GDP/ Real GDP
