The Consumer Price Index (CPI) increased from 125 to 150. Calculate the inflation rate.

May 27, 2026Economics

ScanSolve AI Answer

Answer

20\%

3 steps

Identify the given Consumer Price Index (CPI) values.
The previous CPI is 125.
The current CPI is 150.
Use the formula for calculating the inflation rate.
The inflation rate is calculated as the percentage change in the CPI:
$\text{Inflation Rate} = \frac{\text{CPI}_{\text{current}} - \text{CPI}_{\text{previous}}}{\text{CPI}_{\text{previous}}} \times 100\%$
Substitute the values and calculate the inflation rate.
$\text{Inflation Rate} = \frac{150 - 125}{125} \times 100\%$ $\text{Inflation Rate} = \frac{25}{125} \times 100\%$ $\text{Inflation Rate} = 0.2 \times 100\%$ $\text{Inflation Rate} = 20\%$
The inflation rate is 20%.

The inflation rate is $\boxed{20\%}$ .