Esmeralda who travels with the carnival in a wooden wagon ha

Esmeralda, who travels with the carnival in a wooden wagon, has been watching the prices of luxury recreational vehicals (RVs) hoping to someday purchase one. Last year RVs with the features she desires cost $121, 923, while this year similar RVs are selling for $136, 657. What is the inflation rate on Esmeralda\'s dream RV?

Solution

Final Price of the Esmerala\'s dream RV , P₂ = 1,36,657

Initial Price of the Esmerala\'s dream RV , P₁ = 1,21,923

Change in the Price , P₂ - P₁ = 1,36,657 - 1,21,923 = 14,734

Inflation Rate , ( ( P₂ - P₁ )/P₁ ) * 100 = ( 14,734 / 1,21,923 ) * 100 = 12.084%