Measures of inflation

Measures of inflation

Gdp deflator : ratio between the gdp at current prices and gdp at constant prices

Gdp deflator = gdp( current )/ gdp (constant )

Acclaimed to be a better measure of price behaviour because it covers all goods and services produced in the country [weight of services has not been equitably accounted in the Indian headline inflation ie . inflation at WPI ] wpi does not include services equitably