Read the passage carefully and answer the questions based on the passage:
GDP figures and other macroeconomic variables
Suppose a country only produces rice. In the year 2020, it produced 100 Kg of rice. The price was Rs 10 per kg of rice and the GDP at the current price was Rs 1,000. In 2021, the same country will produce 110 Kg of rice at a price of Rs 15 per kg.
What is GDP deflator?
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → 150 percent.
GDP deflator = (Nominal GDP / Real GDP) * 100
Nominal GDP=Price in 2021 × Quantity in 2021
= 15×110 = ₹1650
Real GDP in 2021 = Quantity in 2021 × Price in base year (2020)
= 110×10 = ₹1100
GDP Deflator= (1650/1100) * 100 = 1.5 * 100 = 150 %