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

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## 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:

- First, determine the previous year’s cost ($). The previous year cost ($) is given as 10,000.
- Next, determine the inflation rate (%). The inflation rate (%) is provided as 5.
- 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 ($)