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The CPI-U has the following annual averages Year 2006 2007 2008 2009 2010 Index 201.600 207.342 215.303 214.537 218.056 a) for each year from 2007

The CPI-U has the following annual averages

Year 2006 2007 2008 2009 2010
Index 201.600 207.342 215.303 214.537 218.056

a) for each year from 2007 to 2010, determine the annual inflation rate in percent to three decimal places.

b) Since inflation, like interest, is compounded from period to period, estimate the overall annual inflation rate per year from 2006 to 2010. Suggestion: do not simply average the rates of Part a.

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