Suppose the CPI last year is 121 and the CPI this year is 137. The CORRECT method to calculate the inflation rate is
A) (137 - 121)/100 = 0.16.
B) 137 × 121 = 258.
C) [(137 - 121)/121] × 100 = 13.2.
D) (137/121) × 100 = 113.2.

Question

Quizplus · Accepted Answer

The correct method to calculate the inflation rate is to subtract the old CPI from the new CPI, divide by the old CPI, and then multiply by 100 to get a percentage. This is exactly what option C does.

Suppose the CPI Last Year Is 121 and the CPI