ECONOMICS
INFLATION
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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CPI Current Year-CPI Previous Year x 100% CPI Current Year
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CPI Previous Year-CPI Current Year x 100% CPI Current Year
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CPI Previous Year-CPI Current Year x 100% CPI Previous Year
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CPI Current Year-CPI Previous Year x 100% CPI Previous Year
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Detailed explanation-1: -First, subtract the CPI from the beginning date (A) from the later date (B), and divide it by the CPI for the beginning date (A). Then multiply the result by 100 to get the inflation rate percentage.
Detailed explanation-2: -The CPI is often used to measure changes in the cost of living, but it is not an ideal indicator of this. While the CPI measures price changes, cost-of-living inflation is the change in spending by households required to maintain a given standard of living.
Detailed explanation-3: -To arrive at a percent change over an entire year, the beginning and ending periods of a CPI series must always be the same month, such as May 2015 and May 2016. Note: A calculation using January and December data would result in an 11-month change, not a 12-month/over-the-year change.
Detailed explanation-4: -Gather prices for common products or services in the past. Collect prices for current products or services. Add the product prices together. Divide the current product price total by the past price total. Multiply the total by 100. Convert this number into a percentage. 13-Jan-2021