Consumer Price Index (CPI) Calculator
Calculate CPI and inflation rate from a basket of goods.
Enter quantities and prices for up to three items in base and current periods to measure price level changes.
The Consumer Price Index measures how much a fixed basket of goods and services costs over time relative to a base period. It is the most widely cited measure of consumer inflation.
The formula:
CPI = (Cost of basket in current period / Cost of basket in base period) x 100
Inflation rate = (CPI - 100) / 100 x 100% (relative to base year)
Or between two periods: inflation = (CPI_new / CPI_old - 1) x 100%
How the basket works. Statistical agencies survey households to determine what a typical consumer buys. Each item gets a weight proportional to its share of total spending. In the US CPI, housing is the largest component (~43%), followed by transportation (~16%), food (~14%), medical care (~9%), and other categories.
The Laspeyres index used here keeps quantities fixed at base-period levels. This is the standard approach and tends to slightly overstate inflation because it does not account for consumers substituting away from goods that become relatively more expensive.
What CPI misses. It does not capture quality improvements. A laptop in 2024 is vastly better than one in 2004, even if the price is similar. Hedonic adjustments try to correct for this but are imperfect. CPI also misses changes in where people shop (outlet substitution) and new goods that enter the market.
Real vs nominal values. Dividing a nominal dollar amount by (CPI/100) converts it to base-year real dollars. This is how economists compare purchasing power across time.