If the consumer price index at the end of 2011 was 100 and at the end of 2012 was 120, then the rate of inflation for 2012 was

Question

25%.
20%.
16,66%.
1,5%.

Answer 1

The rate of inflation can be calculated using the formula:

Inflation Rate = ((CPI end of period - CPI beginning of period) / CPI beginning of period) * 100

Substitute the values into the formula:

Inflation Rate = ((120 - 100) / 100) * 100
Inflation Rate = (20 / 100) * 100
Inflation Rate = 0.20 * 100
Inflation Rate = 20%

Therefore, the rate of inflation for 2012 was 20%.

The correct answer is: 20%.