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29 January, 23:44

In the Republic of Priceland, in 2009 the consumer price index was 168.00. In 2010 the index increased to 180.60. Calculate the rate of inflation in Priceland between 2009 and 2010.

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  1. 30 January, 00:07
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    7.5

    Explanation:

    Data provided

    CPI in the year 2010 = 180.60

    CPI in the year 2009 = 168.00

    The computation of rate of inflation is shown below:

    Inflation rate = ((CPI in the year 2010 - CPI in the year 2009) : CPI in the year 2009) * 100

    = (180.60 - 168.00) : 168.00 * 100

    = 12.6 : 168.00 * 100

    = 0.075 * 100

    = 7.5

    Therefore for computing the inflation rate we simply applied the above formula.
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