What is GDP deflator?

GDP deflator measures the ratio of nominal GDP to real GDP, expressed as a percentage.

$\text{GDP Deflator} = \dfrac{\text{Nominal GDP}}{\text{Real GDP}} \times 100$

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The base year is 2020, with a price of Rs 10 per kg.

Nominal GDP in 2021 (at current year prices):

$= 110 \times 15$

$= \text{Rs } 1650$

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Real GDP in 2021 (at base year prices):

$= 110 \times 10$

$= \text{Rs } 1100$

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$\text{GDP Deflator} = \dfrac{1650}{1100} \times 100$

$= 150\%$

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The GDP deflator is 150 percent.