Here the GDP deflator is 87.5.
Given that in some year nominal GDP was $28 trillion and real GDP was $32 trillion.
GDP Deflator = [tex]\frac{Nominal GDP}{Real GDP}[/tex] × 100
GDP Deflator = [tex]\frac{28}{32}[/tex] × 100
GDP Deflator = 87.5
The price level of all domestically produced final products and services in an economy is measured by the GDP deflator. It is also known as the Implicit Price Deflator or the GDP Price Deflator. It represents changes in the economy's average price level. As a result, along with the Consumer Price Index, it is frequently used by economists and policymakers as a gauge of inflation.
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