The Annual Inflation Rate

The Annual Inflation Rate Just about everything we do as a nation lends to the annual inflation rate. In this article, though, I have chosen four of the most important variables that influence inflation the most. Inflation is the sustained increase in prices, or in other words, a steady decline in the buying power of the dollar. I have come up with an equation that includes the following variables: the unemployment rate, the federal funds …

…Sales in 1000’s. Year Y(i) X(1) X(2) X(3) X(4) 1976 5.8 7.7 5.04 14464 646 1977 6.5 7.1 5.09 14920 819 1978 7.6 6.1 7.93 15588 817 1979 11.3 5.8 11.19 15789 709 1980 13.5 7.1 13.27 15423 545 1981 10.3 7.6 16.38 15334 436 1982 6.2 9.7 12.26 15311 412 1983 3.2 9.6 9.88 15537 623 1984 4.3 7.5 10.23 16203 639 1985 3.6 7.2 8.1 16683 688 1986 1.9 7.0 6.81 17356 750 1987 3.6 6.2 6.66 17779 671 1988 4.1 5.5 7.57 18082 676 1989 4.8 5.3 9.22 18477 650 1990 5.4 5.6 8.10 17942 534 1991 4.2 6.8 5.69 17493 509 1992 3.0 7.5 3.85 17249 610 1993 3.0 6.9 3.02 17797 666 1994 2.6 6.1 4.2 18208 670 1995 2.8 5.6 5.84 18425 667 1996 2.9 5.4 5.30 18841 757 1997 2.3 4.9 5.46 19541 804 1998 1.6 4.5 5.35 20120 886 Bibliography References Cited Bureau of Labor Statistics. http://stats.bls.gov/opub/mlv/1998/08/art3exc.htm. “Consumer Price Index”. http://stats.bls.gov/cpifact5.htm. “Fedpoint 15: Federal Funds”. http://www.ny.frb.org/pihome/fedpoint/fed15.html. Lonski, John. “Inflation is Back”. http://www.dismal.com/thoughts/th_jl_050900.asp. “New Home Sales”. http://www.dismal.com/toolbox/print_definition.asp?r=usa_home_sales