Editing Price level (section)

== Significance ==
If, indeed, a '''general price level''' component could be distinguished, then it would be possible to ''measure'' the difference in overall prices between two regions or intervals.  For example, the [[inflation]] rate could be measured as

:<math>\frac{(P_{t_1}-P_{t_0})/P_{t_0}}{t_1 -t_0}</math>

and “real” [[economic growth]] or contraction could be distinguished from mere price changes by [[GDP deflator|deflating]] [[GDP]] or some other measure.
:<math>\frac{(GDP)_{t_1}}{P_{t_1}}-\frac{(GDP)_{t_0}}{P_{t_0}}</math>