Question
The US Consumer Price Index (CPI) is a measure of the cost of living. The inflation rate is the annual relative rate of change of the CPI. Use the January data in Table $1.24^{47}$ to estimate the inflation rate for each of years $2007-2012$$$\begin{array}{c|c|c|c|c|c|c}\hline \text { Year } & 2007 & 2008 & 2009 & 2010 & 2011 & 2012 \\\hline \text { CPI } & 202.416 & 211.08 & 211.143 & 216.687 & 220.223 & 226.655 \\\hline\end{array}$$
Step 1
This can be calculated using the formula: \[ \text{{Inflation rate}} = \frac{{\text{{CPI}}_{\text{{current year}}} - \text{{CPI}}_{\text{{previous year}}}}}{{\text{{CPI}}_{\text{{previous year}}}}} \times 100\% \] Show more…
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