Question

If the CPI is 123 in year 1 and 143 in year 2, what is the approximate percentage change in prices between the two years?

A. 10.3 percent
B. 16.3 percent
C. 15.7 percent
D. 11.4 percent
E. 23.9 percent

Answer 1

B. 16.3 percent

Step-by-step explanation:

The consumer price index in year 1 = 123

The consumer price index in year 2 =143

Now we have given two years consumer price index and from this information, we are required to find the percentage change in the consumer price index. Below is the formula to find the percentage change.

Percentage change in CPI = (Year 2 CPI – Year 1 CPI) / Year 1 CPI

Percentage change in CPI = (143 – 123 ) / 123

Percentage change in CPI = 0.1626 or 16.3%

Thus, Option “b” 16.3 Percent is correct.