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In 1972 a Honda Civic went for $2000, today a Honda civic sells for around $25000. The rate of inflation is %

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1 vote

Answer:

5.1%

Explanation:

You want the rate of inflation if the price of a Honda Civic increase from $2000 in 1972 to $25000 in 2023.

Inflation

The rate of inflation can be computed from ...

r = (p1/p0)^(1/t) -1

r = (25000/2000)^(1/51) -1 ≈ 0.05077 ≈ 5.1%

The rate of inflation is about 5.1%.

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Additional comment

The question refers to "today," but we don't know exactly what is intended by that. The year at the time of this writing has been used. The required answer may vary, depending on the intended number of years.

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In 1972 a Honda Civic went for $2000, today a Honda civic sells for around $25000. The-example-1
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