If the GDP deflator rises from 185 to 190, what is the rate of inflation between the two years?

Question

Quizplus · Accepted Answer

The GDP deflator is a measure of the overall price level of goods and services produced in an economy. A rise in the GDP deflator indicates that the overall price level has increased, which means that there has been inflation. The rate of inflation is calculated as the percentage change in the GDP deflator from one year to the next. In this case, the GDP deflator has risen from 185 to 190, which represents a 2.7% increase. Therefore, the rate of inflation between the two years is 2.7%.

If the GDP Deflator Rises from 185 to 190, What