Question

If the price level as measured by the CPI was 150 in 2018 and the project price level for 2019 is 120. Calculate the expected inflation rate between 2018 and 2019

Answer 1

inflation rate = {(B-A)/A}X100

A= 2018 = 150

B= 2019= 120

={ (120-150)/ 150}X 100

=( -30/150) X 100

= -0.2x100

= -20

there was a deflation of 20 between 2018 and 2019