Question

Given the following data :

$\begin{array}{ccccccccc}\text{Year}& 2004-05& 2005-06& 2006-07& 2007-08& 2008-09& 2009-10& 2010-11& 2011-12\\ \underset{(2004-05)}{\text{WPI}}& 121.6& 127.2& 132.8& 140.7& 145.7& 155.7& 161.3& 166.8\end{array}$

Calculate the inflation rate.

Answer 1

Inflation rate for different years are calculated as :
$\text{Year}2005-06=\frac{X_t-X_{t-1}}{X_{t-1}}\times 100=\frac{127.2-121.6}{121.6}\times 100=4.6\%\text{Year}2006-07=\frac{X_t-X_{t-1}}{X_{t-1}}\times 100=\frac{132.8-127.2}{127.2}\times 100=4.40\%\text{Year}2007-08=\frac{X_t-X_{t-1}}{X_{t-1}}\times 100=\frac{140.7-132.8}{132.8}\times 100=5.94\%\text{Year}2008-09=\frac{X_t-X_{t-1}}{X_{t-1}}\times 100=\frac{145.7-140.7}{140.7}\times 100=3.55\%\text{Year}2009-10=\frac{X_t-X_{t-1}}{X_{t-1}}\times 100=\frac{155.7-145.7}{145.7}\times 100=6.86\%\text{Year}2010-11=\frac{X_t-X_{t-1}}{X_{t-1}}\times 100=\frac{161.3-155.7}{155.7}\times 100=3.59\%\text{Year}2011-12=\frac{X_t-X_{t-1}}{X_{t-1}}\times 100=\frac{166.8-161.3}{161.3}\times 100=3.40\%$
There are many ups and down in the WPI.