The formula to calculate the average annual rate of inflation is:
Average Annual Rate of Inflation = ((Current Index - Base Index) / Base Index) * 100
where:
- Current Index represents the current consumer price index (CPI)
- Base Index represents the consumer price index from the previous period or year
This formula calculates the percentage increase in the CPI from the base period to the current period.
Formula to calculate the average annual rate of inflation
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