If the consumer price index was 100 in the base year and 106 in the following year,then the inflation rate was
A)1.06 percent.
B)6 percent.
C)10.6 percent.
D)106 percent.

Question

Quizplus · Accepted Answer

To calculate the inflation rate, we use the formula:
Inflation rate = ((CPI in current year - CPI in previous year)/CPI in previous year) x 100%

In this case, the CPI in the previous year (or the base year) is 100 and the CPI in the following year is 106. Plugging these values into the formula, we get:

((106-100)/100) x 100% = 6%

Therefore, the inflation rate is 6%. The correct answer is B.

If the Consumer Price Index Was 100 in the Base