Enter the previous year’s cost ($) and the inflation rate (%) into the Inflation Cost Calculator. The calculator will evaluate and display the Inflation Cost. 

Inflation Cost Formula

The following formula is used to calculate the Inflation Cost. 

IC =  PC * IR/100
  • Where IC is the Inflation Cost ($)
  • PC is the previous year’s cost ($) 
  • IR is the inflation rate (%) 

To calculate the inflation cost, multiply the previous year’s cost by the inflation rate.

How to Calculate Inflation Cost?

The following example problems outline how to calculate Inflation Cost.

Example Problem #1:

  1. First, determine the previous year’s cost ($). The previous year cost ($) is given as 10,000.
  2. Next, determine the inflation rate (%). The inflation rate (%) is provided as 5.
  3. Finally, calculate the Inflation Cost using the equation above: 

IC =  PC * IR/100

The values given above are inserted into the equation below:

IC =  10,000 * 5/100 = 5,000.00 ($)

Example Problem #2: 

The variables needed for this problem are provided below:

previous year cost ($) = 20,000

inflation rate (%) = 5

Entering these values and solving gives:

IC =  PC * IR/100 = 10,000.00 ($)