How is the inflation calculated?

The below example explains how the inflation is calculated by the Calculator .
 
Example:
We want to know how much goods worth $ 100 in 2013 cost in 2014 ? The calculations are explained below.

Average Consumer Price Index(CPI) in the year 2013 is 132.229 and

Average Consumer Price Index(CPI) in the year 2014 is 138.481
 
2014 equivalent of goods worth $ 100 in 2013
        = ( 2014 CPI / 2013 CPI ) * Amount
        = ( 138.481 / 132.229 ) * 100
        = $ 104.73