# Inflation Calculator

Why the exact thing I bought today is expensive than five years ago? If this burning question comes into your mind, then our inflation calculator and this article will answer all your quires.

The **overall increment that occurs in terms of prices** is known as **inflation**. Opposit to it, **if the prices decrease in a certain period**, it is known as **deflation**. Moreover, If the prices of goods or services increase gradually, it may decrease consumers' buying power and impact currency's value. Inflation occurs due to production costs, increment in demand, and decrement in supply, government regulation, and the country's economic status. Typically, policymakers try to sustain prices and keep the annual inflation rate to 2%.

**Table Of Contents**

## Formula Of Inflation Calculator

To find the value of inflation (in %), you can use the formula listed below:

Inflation rate = [(FP - IP)/IP]*100

**Where,**

IP = Initial price

FP = Final price

**Note:**

Find out gratuity, you can use our Gratuity Calculator.

### Example

For more prices understanding, let us have an example below:

Suppose a product that cost $45 three years ago; nowadays, it costs $54. Now calculate the inflation value at this specific time.

**Given data**

Initial value = $45

Final Value = $54

**To Find**

Inflation value (in %) = ?

**Solution**

To solve the above problem, we will use the formula listed above.

Inflation rate = [(FP - IP)/IP] * 100

Putting values in the formula:

Inflation = [(54 - 45)/45] * 100 = 0.2 * 100 = 20%

### How to use the Inflation Calculator?

The steps to use the inflation calculator are as follows:

**Step 1: **Enter initial price in the first required input.

**Step 2: **Enter the final price in the second required input.

**Step 3: **The calculator will automatically display an answer on the screen.

### Calculator Use

To find out the rate of increment that occurs in prices, you can use our inflation calculator. Just enter the required values, and our free online calculator will display the answer on the screen.