If the price index in 2015 is 132 and the price index in 2016 is 114, the rate of inflation between 2015 and 2016 is
A) -13.6%.
B) -5.8%.
C) 6.4%.
D) 15.8%.

Question

Quizplus · Accepted Answer

The rate of inflation is calculated as the percentage change in the price index from one period to the next. Here, the price index decreased from 132 in 2015 to 114 in 2016. The rate of inflation is thus negative, indicating deflation. The calculation is: [(114 - 132) / 132] * 100 = -13.6%.

If the Price Index in 2015 Is 132 and the Price