Answer to Question #319197 in Macroeconomics for Damian Narainsamy

Question

If 2020 is the base year for real gdp calculations we know for certain that nominal gdp?

Answer 1

The GDP Deflator tracks price changes in a country's economy over time. It will take a base year, where nominal GDP equals real GDP, and sets it equal to 100. Any change in price will be reflected in nominal GDP, which will lead to a change in the GDP Deflator.