The index ranges from an annual average of 9.9 in 1913 to an annual average of 156.9 in 1996. This means that, over this period of time, prices as measured by the Consumer Price Index , have increased by a factor of nearly 16. It is important to note in a story or graphic that you are using the CPI as your adjustment method. There are other indexes, but the CPI is the most widely used. If you re trying to tell whether the budget of a city government is going up suspiciously fast, you re applying a consumer market basket to the city s purchases.
Most consumers don t pick up asphalt, gravel or bulldozers on a trip to the market.
The answer, 2.8327, becomes the multiplier to turn the 1975 income number into 1995 adjusted dollars. The attached sheets have the annual average multipliers already calculated. This is the multiplier. Draw your finger across the 1990 line to the Multiplier Column. The multiplier is 1.200.