Answer: d. 103.2.
Step-by-step explanation:
Formula for inflation rate = [tex]\dfrac{PI_2-PI_1}{PI_1}\times100[/tex]
, where [tex]PI_1[/tex] = Price index in first period
[tex]PI_2[/tex] = Price index in second period.
As per given , we have
The inflation rate between 2012 and 2013= 24%
The price index was 128 in 2013.
i.e. [tex]PI_2=128[/tex]
Let x be the price index in 2012
Then, we have
[tex]\dfrac{128-x}{x}\times100=24[/tex] [Substitute all values in formula]
[tex]128-x=0.24x\\\\ 0.24x+x=128\\\\ 1.24x= 128\\\\ x=\dfrac{128}{1.24}\approx103.2[/tex]
Hence, the price index in 2012 was 103.2.
So , the correct option is d. 103.2.
