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26 May, 00:21

If the cpi is 120 in year 1 and 150 in year 2, then the rate of inflation from year 1 to year 2 is:

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  1. 26 May, 00:36
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    The inflation can be measured by the percentage of change in the CPI.

    From the givens:

    The change between year 1 and year 2 = 150 - 120 = 30

    Now, the percentage of change can be calculated as follows:

    % of change = (change in CPI/original CPI) * 100

    % of change = (30/120) * 100 = 25%

    From, the definition, inflation is measured as the percentage in change of CPI, therefore, inflation = 25%
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