Suppose the CPI was 132.00 in 1997 and is 135.30 in 1998. What is the rate of inflation over the period?

Question

Quizplus · Accepted Answer

To calculate the rate of inflation, we can use the following formula:

Inflation rate = ((CPI in year 2 - CPI in year 1) / CPI in year 1) x 100

In this case, CPI in 1997 is the base year, so:

Inflation rate = ((135.30 - 132.00) / 132.00) x 100
Inflation rate = 2.5%

Therefore, the answer is choice B (2.5 percent).

Suppose the CPI Was 132