In​ Brazil, the reference base period for the CPI is 2000.  By​ 2005, prices had risen by 51 percent since the base period. The inflation rate in Brazil in 2006 was 10​ percent, and in​ 2007, the inflation rate was 9 percent.  Calculate the CPI in Brazil in 2006 and 2007.​ Brazil's CPI in 2008 was 173. Did​ Brazil's inflation rate increase or decrease in​ 2008?

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Asked Feb 27, 2019
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In Brazil, the reference base period for the CPI is 2000.
 
By 2005, prices had risen by 51 percent since the base period. The inflation rate in Brazil in 2006 was 10 percent, and in 2007, the inflation rate was 9 percent.
 
Calculate the CPI in Brazil in 2006 and 2007. Brazil's CPI in 2008 was 173. Did Brazil's inflation rate increase or decrease in 2008?
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Expert Answer

Step 1

The given information:

Base period is 2000

In 2005 price  increases by 51%

Brazil inflation rate in 2006 is 10%

Brazil inflation rate in 2007 is 9%

Step 2

Brazil CPI in 2005:

Brazil CPI in 2005 can be calculated as follows:

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Step 3

A.

Brazil CPI in 2006:

Brazil CPI in 2006 can be calcula...

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