Suppose in 2007, nominal GDP in a country Clarendon was $12,840 billion and real GDP was $10,560 billion. Calculate the value of the implicit price deflator, in the way such numbers are normally published.

Question

Quizplus · Accepted Answer

The Implicit Price Deflator (IPD) is a measure of the overall price level of goods and services in an economy, as well as an indicator of inflation or deflation. The formula for calculating the IPD is:

IPD = (Nominal GDP / Real GDP) x 100

Substituting the values given in the question, we get:

IPD = (12,840 / 10,560) x 100
IPD = 121.59

Therefore, the value of the implicit price deflator in Clarendon in 2007 was 121.59. The correct answer is C.

Suppose in 2007, Nominal GDP in a Country Clarendon Was