GDP deflator calculator (real vs nominal GDP)

Pick what you have and what you want. Enter nominal GDP and the GDP deflator to get real GDP, enter nominal and real to get the deflator, compare two years, or type in prices and quantities of goods and let the calculator build GDP for you.

Inputs

The deflator is the GDP price index, published with 100 in the base year.

GDP at the prices of the year itself. Any currency or unit: billions of dollars works.

The price index, with 100 in the base year (so 112 means prices 12% above the base year).

Real GDP

3,267.47in base-year prices

Prices are 83.4% below the base year, so real GDP is larger than nominal GDP: 542.4 ÷ (16.6 ÷ 100).

Nominal GDP
542.4
GDP deflator
16.6
Price level against the base year
−83.4%
Nominal and real GDP

Nominal GDP of 542.4 with a GDP deflator of 16.6 gives real GDP of 3,267.47 in base-year prices. Prices are 83.4% below the base year.

How to read this graph

  • Each pair of bars is one year. The dark bar is nominal GDP and the light one is real GDP in the base year’s prices. Where the deflator is above 100, real GDP is the shorter bar; where it is below 100, real GDP is the taller one.
  • In the base year the two bars are the same, because the deflator is 100 there and nothing needs adjusting.
  • Two years side by side show the whole story of growth: how much of the rise in nominal GDP is higher prices, and how much is more output.

How it works

real GDP = nominal GDP ÷ (GDP deflator ÷ 100)
GDP deflator = nominal GDP ÷ real GDP × 100
nominal GDP = Σ (price × quantity), both of the same year
real GDP = Σ (base-year price × quantity of the year)
inflation = deflator₂ ÷ deflator₁ − 1
real growth = real GDP₂ ÷ real GDP₁ − 1
quick rule: real growth ≈ nominal growth − inflation
  • The deflator is 100 in the base year. There, real and nominal GDP are the same, by construction.
  • After the base year, with positive inflation, real GDP is below nominal GDP. Before it, real is above nominal.
  • The identity behind the quick rule: 1 + nominal growth = (1 + inflation) × (1 + real growth). The quick rule drops the small product of the two growth rates, so it is close when both are small and rough when they are large.
  • Prices and quantities mode adds up every good’s price times quantity for each year. Real GDP uses the base year’s prices for both years’ quantities.
  • Nominal and real GDP can be in any currency or unit. The formulas only use ratios.

Worked example

The UW–Madison hot dogs and burgers. In 2014 an economy makes 15 hot dogs at $2 and 20 burgers at $7. In 2015 it makes 20 hot dogs at $4 and 30 burgers at $8. Open it in the calculator, with 2014 as the base year.

  • Nominal GDP: 2014 is 15 × 2 + 20 × 7 = 170; 2015 is 20 × 4 + 30 × 8 = 320.
  • Real GDP at 2014 prices: 2014 is 170 (it is the base year); 2015 is 20 × 2 + 30 × 7 = 250.
  • GDP deflator: 2014 is 100; 2015 is 320 ÷ 250 × 100 = 128.
  • Inflation: 128 ÷ 100 − 1 = 28%. Real GDP grew 250 ÷ 170 − 1 = 47.1%, while nominal GDP grew 88.2%.

More to try:

  • OpenStax 1960: nominal GDP of $542.4 billion and a deflator of 16.6 (2012 = 100) give real GDP of 542.4 ÷ 0.166 = $3,267.5 billion, in 2012 dollars.
  • OpenStax 1960 to 2020: real GDP grows from $3,267.5 billion to $18,392.3 billion, up 463%. Prices rose 584% over the same years, and nominal GDP rose about 3,752%.
  • Finding the deflator: nominal GDP of 12,000 and real GDP of 10,000 give a deflator of 120, prices 20% above the base year. (The UW–Madison handout asks for this one without printing the answer.)
  • Base year 2015 instead: the same prices and quantities give 29.4% inflation.

Tips

  • Match the base years. The two deflators you enter must come from the same index with the same base year. OpenStax’s are 2012 = 100; a deflator from a different series will not work against them.
  • A deflator is not an inflation rate. 128 means prices are 28% above the base year. The inflation rate between two years is the change from one deflator to the other.
  • Real GDP is in the base year’s dollars. Say so in your answer: “$3,267.5 billion in 2012 dollars”.
  • Check the direction. If real GDP comes out bigger than nominal GDP, the deflator was below 100, so prices were lower than in the base year.
  • Rounding differs between books. OpenStax prints one decimal and works from the rounded figures, so your answer may differ in the last digit.

FAQ

What is the difference between nominal GDP and real GDP?

Nominal GDP values what was produced at the prices of the year it was produced. Real GDP values it at the prices of a fixed base year, so it only changes when the amount produced changes. OpenStax’s example: U.S. nominal GDP was about 38 times higher in 2020 than in 1960, but most of that was higher prices. In 2012 dollars real GDP grew by 463%, roughly a factor of five.

What does the GDP deflator tell me?

It is a price index for everything counted in GDP, with 100 in the base year. A deflator of 112 means prices are 12% above the base year and 95 means 5% below. Divide nominal GDP by the deflator over 100 to take the price level out. In OpenStax’s table the 1960 deflator of 16.6 against 100 in 2012 means prices in 1960 were about 83% below 2012 prices.

Why do I divide the deflator by 100?

Because a price index is really a decimal like 1.00 or 0.85, and it is published multiplied by 100 (100 or 85) to avoid decimals. Dividing by 100 puts it back before you divide nominal GDP by it. Real GDP = nominal GDP ÷ (deflator ÷ 100). The calculator does this for you, and shows the working in the hints.

Does the base year matter?

Yes. The deflator is 100 in whichever year you pick, and every other year’s real GDP and deflator are measured against that year’s prices. Take the UW–Madison hot dog and burger example. With 2014 as the base the deflator rises from 100 to 128, which is 28% inflation. With 2015 as the base it goes from about 77.3 to 100, which is 29.4%. The same economy gives a slightly different inflation rate, and real growth changes too (47.1% against 45.5%), because each base year weights the goods by different prices. Both deflators you enter must share one base year.

How do I get real growth without calculating real GDP?

As a quick rule, real growth is about nominal growth minus inflation, which OpenStax gives as an approximation that works for small changes. For 1960 to 2020 you need the exact formula, because the changes are huge. The two-year mode shows both the exact real growth and the quick approximation next to each other.

Can I use this for things other than GDP?

Yes. Dividing a nominal amount by a price index over 100 gives the real amount for any figure measured in money, such as sales or wages, as long as the index uses the same base year. OpenStax opens with a t-shirt company: $90 of sales at $9 a shirt is 10 shirts. The calculator labels everything as GDP but the arithmetic is the same.

Sources

  1. 6.2 Adjusting Nominal Values to Real Values, OpenStax, Principles of Macroeconomics 3e (Rice University). Real GDP = nominal GDP ÷ (price index ÷ 100) with U.S. GDP from 1960 to 2020 (Tables 6.5 and 6.6), the base year, real growth of 463% from 1960 to 2020, and the rule that real growth is about nominal growth minus inflation.
  2. Econ 102 Discussion Section 4: Real vs. Nominal GDP, University of Wisconsin–Madison, Economics 102 (TA Kanit Kuevibulvanich, Spring 2015). The price-quantity method with hot dogs and burgers (nominal GDP of 170 and 320, real GDP of 170 and 250 at 2014 prices), a GDP deflator of 100 and 128, and inflation of 28%.

Formula and sources last checked September 30, 2026. How we test formulas.