Suppose a nation's CPI is 150 in Year 1 and 180 in Year 2. What is the rate of inflation?
A) 17%
B) 15%
C) 20%
D) 25%

Question

Quizplus · Accepted Answer

The rate of inflation can be calculated using the formula:

Inflation rate = ((CPI in Year 2 - CPI in Year 1) / CPI in Year 1) * 100%

Substituting the given values, we get:

Inflation rate = ((180 - 150) / 150) * 100%
Inflation rate = (30 / 150) * 100%
Inflation rate = 20%

Therefore, the answer is C) 20%.

Suppose a Nation's CPI Is 150 in Year 1 and 180