If your salary was $50,000 last year, and this year you receive a cost-of-living increase tied to the consumer price index (CPI), what will your salary be this year assuming the CPI has risen from 110 to 114?

Question

Quizplus · Accepted Answer

The cost-of-living increase is calculated by the percentage increase in the CPI. The CPI increased from 110 to 114, which is a 3.64% increase ((114-110)/110 * 100). Applying this percentage increase to the $50,000 salary results in a new salary of $51,818 ($50,000 * 1.0364).

If Your Salary Was $50,000 Last Year, and This Year