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Gdp Deflator
Linked via "Real GDP"
The fundamental purpose of the GDP Deflator is to isolate the volume effect from the price effect in the observed change in nominal GDP. If nominal GDP increases, the deflator helps determine how much of that increase is due to higher prices rather than a genuine increase in the quantity of output.
The deflator is derived directly from the standard relationship between Nominal GDP ($Y_N$), [Real GDP](/entrieā¦