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GDP Deflator Formula. In previous articles on formulas for nominal and real GDP and deriving inflation rates from GDP deflators, we’ve touched on the concept of the GDP deflators. I want to briefly focus on the concept here. GDP deflators show you whether GDP growth comes from inflation or deflation compared to an actual change in output […]

In a previous article here, we covered the formulas for nominal and real GDP. In that article, we also touched on GDP deflators. I’ll repeat our prior definition and a short excerpt here: So, the real GDP in 2026 is $120, while the nominal GDP is $144. This means that roughly half of the “increase in

The labor force participation rate is the percentage of a working-age population that is employed or seeking employment. This does not reflect the overarching population of a country, and rather the economically active portion of a population is contributing, or looking to contribute, to the labor market. The formula for the labor force participation rate is

The Rule of 70 is a quick, easy way to estimate the number of years required for a quantity to double given a fixed annual rate of compounding growth. The Rule of 70 states that years to double for an input equals 70 divided by the annual growth rate. So, if annual growth is 10%

GDP, or gross domestic product, is a measure of the goods and services produced in a country within a certain period of time. Real GDP adjusts for inflation or deflation within an economy, while Nominal GDP uses current prices. So, as follows: Real GDP uses a base year to adjust nominal GDP for inflation or deflation.Nominal

Photo by Campaign Creators on Unsplash The Differentiated Bertrand Model is a theoretical model used in economics that explores competition and pricing behavior among firms producing, as inferred, differentiated products. The Bertrand model alone, on the other hand, focuses on homogeneous products. In the differentiated Bertrand model, firms compete for imperfect substitutes. So, consumers have preferences

Photo by David Vives on Unsplash UPP, which stands for Upward Pricing Pressure, is a measure used in merger analysis to determine whether a given merger will result in higher prices for consumers. It was introduced in 2010 by economists Joseph Farrell and Carl Shapiro and bases itself on the idea that two merged firms may

Photo by Kaleidico on Unsplash The Herfindahl index, known as the Herfindahl–Hirschman Index or HHI, measures the size of firms in relation to the industry they operate in. Thus, it provides insight into how concentrated a market is, and is used in antitrust lawsuits to determine how much market power a given firm has. This is the

Photo by Paul Fiedler on Unsplash Horizontal restraints are contractual agreements between competing firms that restrain trade, such as by fixing prices, limiting production, rigging bids or auctions, or artifically allocating markets or customers. While horizontal restraints aren’t necessarily only anti-competitive—with some having pro-competitive effects as well—many cases of horizontal restraint, like price fixing, are purely

Photo by m. on Unsplash Similarly to horizontal restraints, horizontal mergers are mergers between firms that directly compete — take the Discovery and Capital One merger from just a few days ago. Firms compete, in turn, if customer view the firms’ products as substitutes (diversion being the principal metric there). Firms may horizontally merge to increase or protect their