Total spending on health care in a certain region rose from

Total spending on health care in a certain region rose from $921 million in 1977 to $878 billion in 2006.Compare this rise in health care spending to the overall rate of inflation as measured by the Consumer Price Index.

CPI Year CP Year CP Year 1976 56.9 1987 113.6 1998 163.0 1977 60.6 1988 118.3 1999 166.6 1978 65.2 1989 124.0 2000 172.2 1979 72.6 1990 130.7 2001 177.1 1980 82.4 1991 136.2 2002 179.9 1981 90.9 1992 40.3 2003 184.0 1982 96.5 1993 44.5 2004 188.9 1983 99.6 1994 148.2 2005 195.3 1984 103.9 1995 152.4 2006 201.6 1985 107.6 1996 156.9 2007 207.3 1986 09.6 1997 160.5 2008 215.3

Solution

Health care spending increased by:

(878 * 10^9 - 921 * 10^6) * 100/(921 * 10^6) = 95231%

Inflation rate:

(CPI 2008 - CPI 1976)/ (CPI 1976) = (215.3 - 56.9) * 100/ 56.9 = 278%