Real and nominal value interpretation When price is deflated according to some base year, what does the real value mean? E.g. if we are deflating \$5.000 from year 2000 (base year, deflator=1) to 1980, using the CPI 1.6 from 1980, we get \$3.125. 

Is this real value equivalent to $5.000 in 1980?
The formula for calculating the real value of an amount $x$ in a given year using dollars from a particular reference year is 

$$
\frac{x_{baseyear}}{x_{current year}}=\frac{CPI_{base year}}{CPI_{current year}} 
$$

So in your hypothetical example (where the deflator is higher in 1980 than in 2000, which indicates deflation over the period), the value of \$5 in 2000 is equal in 1980 to:

$$
x_{current year}=x_{base year}*\frac{CPI_{current year}}{CPI_{base year}} 
$$

or

$$
$5*\frac{1.6}{1}=$8 
$$

So in your example, a basket of goods costing \$5 in 2000 would cost \$8 in 1980.