Given a Real GDP of $5,000 and a Nominal GDP of $5,500 , calculate the GDP deflator. Round your answer to the nearest tenth if necessary.(1 point) Responses 110 110 90.9 90.9 0.9 0.9 1.1

Answer 1

The GDP deflator can be calculated using the following formula:

\[ \text{GDP Deflator} = \left( \frac{\text{Nominal GDP}}{\text{Real GDP}} \right) \times 100 \]

Given:

• Nominal GDP = $5,500
• Real GDP = $5,000

Now, substituting the values into the formula:

\[ \text{GDP Deflator} = \left( \frac{5,500}{5,000} \right) \times 100 \]

Calculating the fraction:

\[ \frac{5,500}{5,000} = 1.1 \]

Now multiplying by 100:

\[ \text{GDP Deflator} = 1.1 \times 100 = 110 \]

Therefore, the GDP deflator is 110.