This means that over time a rupee will be able to buy a lesser amount of goods and services. If the inflation rate is 5%, then Rs. 100 worth of goods will cost Rs. 105 after a year. The following table indicates how the value of Rs 1,00,000 will change over time at different levels of inflation.
| Inflation % p.a. | ||||||
|---|---|---|---|---|---|---|
| Years | 2 | 3 | 4 | 4.5 | 5 | 6 |
| 5 | 90,573 | 86,261 | 82,193 | 80,245 | 78,353 | 74,726 |
| 10 | 82,035 | 74,409 | 67,556 | 64,393 | 61,391 | 55,839 |
| 15 | 74,301 | 64,186 | 55,526 | 51,672 | 48,102 | 41,727 |
| 20 | 67,297 | 55,368 | 45,639 | 41,464 | 37,689 | 31,180 |
| 25 | 60,953 | 47,761 | 37,512 | 33,273 | 29,530 | 23,300 |
| 30 | 55,207 | 41,199 | 30,832 | 26,700 | 23,138 | 17,411 |
table indicating the value of Rs 1,00,000 at different levels of inflation over time.
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