ECONOMICS
INFLATION
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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8%
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7%
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6%
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5%
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Detailed explanation-1: -To find the CPI in any year, divide the cost of the market basket in year t by the cost of the same market basket in the base year. The CPI in 1984 = $75/$75 x 100 = 100 The CPI is just an index value and it is indexed to 100 in the base year, in this case 1984. So prices have risen by 28% over that 20 year period.
Detailed explanation-2: -The Consumer Price Index (CPI) in year 1 was 120 and in year 2 was 150. Inflation is the rise in the price level. The inflation between year 1 and year 2 is calculated below. Hence, the inflation rate between year 1 and year 2 is 25%.
Detailed explanation-3: -If the consumer price index (CPI) in Year 1 was 200 and the CPI in Year 2 was 215, the rate of inflation is: a. 215 percent.
Detailed explanation-4: -Tally all expenses from your bank and credit card statements in the past 12 months, as well as for the prior 12-month period. Subtract the totals and divide by the first year’s spending. Multiply that number from step 2 by 100 to determine your personal annual inflation rate. 07-Jul-2022