# \$1 in 1973 → \$1.21 in 1975

## Inflation Calculator

\$

### U.S. Inflation Rate, \$1 from 1973 to 1975

According to the Bureau of Labor Statistics consumer price index, prices in 1975 are 21.17% higher than average prices since 1973. The U.S. dollar experienced an average inflation rate of 10.08% per year during this period, meaning the real value of a dollar decreased.

In other words, \$1 in 1973 is equivalent in purchasing power to about \$1.21 in 1975, a difference of \$0.21 over 2 years.

The 1973 inflation rate was 6.22%. The inflation rate in 1975 was 9.13%. The 1975 inflation rate is higher compared to the average inflation rate of 3.55% per year between 1975 and 2020.

 Cumulative price change 21.17% Average inflation rate 10.08% Converted amount (\$1 base) \$1.21 Price difference (\$1 base) \$0.21 CPI in 1973 44.400 CPI in 1975 53.800 Inflation in 1973 6.22% Inflation in 1975 9.13%

USD Inflation since 1913
Annual Rate, the Bureau of Labor Statistics CPI

### Buying power of \$1 in 1973

This chart shows a calculation of buying power equivalence for \$1 in 1973 (price index tracking began in 1635).

For example, if you started with \$1, you would need to end with \$1.21 in order to "adjust" for inflation (sometimes refered to as "beating inflation").

When \$1 is equivalent to \$1.21 over time, that means that the "real value" of a single U.S. dollar decreases over time. In other words, a dollar will pay for fewer items at the store.

This effect explains how inflation erodes the value of a dollar over time. By calculating the value in 1973 dollars, the chart below shows how \$1 buys less over the past 2 years.

According to the Bureau of Labor Statistics, each of these USD amounts below is equal in terms of what it could buy at the time:

Year Dollar Value Inflation Rate
1973 \$1.00 6.22%
1974 \$1.11 11.04%
1975 \$1.21 9.13%
1976 \$1.28 5.76%
1977 \$1.36 6.50%
1978 \$1.47 7.59%
1979 \$1.64 11.35%
1980 \$1.86 13.50%
1981 \$2.05 10.32%
1982 \$2.17 6.16%
1983 \$2.24 3.21%
1984 \$2.34 4.32%
1985 \$2.42 3.56%
1986 \$2.47 1.86%
1987 \$2.56 3.65%
1988 \$2.66 4.14%
1989 \$2.79 4.82%
1990 \$2.94 5.40%
1991 \$3.07 4.21%
1992 \$3.16 3.01%
1993 \$3.25 2.99%
1994 \$3.34 2.56%
1995 \$3.43 2.83%
1996 \$3.53 2.95%
1997 \$3.61 2.29%
1998 \$3.67 1.56%
1999 \$3.75 2.21%
2000 \$3.88 3.36%
2001 \$3.99 2.85%
2002 \$4.05 1.58%
2003 \$4.14 2.28%
2004 \$4.25 2.66%
2005 \$4.40 3.39%
2006 \$4.54 3.23%
2007 \$4.67 2.85%
2008 \$4.85 3.84%
2009 \$4.83 -0.36%
2010 \$4.91 1.64%
2011 \$5.07 3.16%
2012 \$5.17 2.07%
2013 \$5.25 1.46%
2014 \$5.33 1.62%
2015 \$5.34 0.12%
2016 \$5.41 1.26%
2017 \$5.52 2.13%
2018 \$5.66 2.49%
2019 \$5.76 1.76%
2020 \$5.83 1.18%*
* Compared to previous annual rate. Not final. See inflation summary for latest 12-month trailing value.

### Inflation by City

Inflation can vary widely by city, even within the United States. Here's how some cities fared in 1973 to 1975 (figures shown are purchasing power equivalents of \$1):

Houston, Texas experienced the highest rate of inflation during the 2 years between 1973 and 1975 (11.67%).

Detroit, Michigan experienced the lowest rate of inflation during the 2 years between 1973 and 1975 (9.13%).

Note that some locations showing 0% inflation may have not yet reported latest data.

### Inflation by Country

Inflation can also vary widely by country. For comparison, in the UK £1.00 in 1973 would be equivalent to £1.44 in 1975, an absolute change of £0.44 and a cumulative change of 44.17%.

In Canada, CA\$1.00 in 1973 would be equivalent to CA\$1.23 in 1975, an absolute change of CA\$0.23 and a cumulative change of 23.27%.

Compare these numbers to the US's overall absolute change of \$0.21 and total percent change of 21.17%.

### Inflation by Spending Category

CPI is the weighted combination of many categories of spending that are tracked by the government. This chart shows the average rate of inflation for select CPI categories between 1973 and 1975.

Compare these values to the overall average of 10.08% per year:

Category Avg Inflation (%) Total Inflation (%) \$1 in 1973 → 1975
Food and beverages 11.06 23.34 1.23
Housing 10.89 22.97 1.23
Apparel 5.92 12.20 1.12
Transportation 10.29 21.65 1.22
Medical care 10.69 22.53 1.23
Recreation 0.00 0.00 1.00
Education and communication 0.00 0.00 1.00
Other goods and services 7.76 16.13 1.16

The graph below compares inflation in categories of goods over time. Click on a category such as "Food" to toggle it on or off:

For all these visualizations, it's important to note that not all categories may have been tracked since 1973. This table and charts use the earliest available data for each category.

### How to Calculate Inflation Rate for \$1, 1973 to 1975

This inflation calculator uses the following inflation rate formula:

CPI in 1975CPI in 1973
×
1973 USD value
=
1975 USD value

Then plug in historical CPI values. The U.S. CPI was 44.4 in the year 1973 and 53.8 in 1975:

53.844.4
×
\$1
=
\$1.21

\$1 in 1973 has the same "purchasing power" or "buying power" as \$1.21 in 1975.

To get the total inflation rate for the 2 years between 1973 and 1975, we use the following formula:

CPI in 1975 - CPI in 1973CPI in 1973
×
100
=
Cumulative inflation rate (2 years)

Plugging in the values to this equation, we get:

53.8 - 44.444.4
×
100
=
21%

### Alternate Measurements of Inflation

The above data describe the CPI for all items. Also of note is the Core CPI, which measures inflation for all items except for the more volatile categories of food and energy. Core inflation averaged 8.73% per year between 1973 and 1975 (vs all-CPI inflation of 10.08%), for an inflation total of 18.22%.

When using the core inflation measurement, \$1 in 1973 is equivalent in buying power to \$1.18 in 1975, a difference of \$0.18. Recall that for All Items, the converted amount is \$1.21 with a difference of \$0.21.

In 1973, core inflation was 3.49%.

### Comparison to S&P 500 Index

The average inflation rate of 10.08% has a compounding effect between 1973 and 1975. As noted above, this yearly inflation rate compounds to produce an overall price difference of 21.17% over 2 years.

To help put this inflation into perspective, if we had invested \$1 in the S&P 500 index in 1973, our investment would be nominally worth approximately \$0.92 in 1975. This is a return on investment of -8.04%, with an absolute return of \$-0.08 on top of the original \$1.

These numbers are not inflation adjusted, so they are considered nominal. In order to evaluate the real return on our investment, we must calculate the return with inflation taken into account.

The compounding effect of inflation would account for 17.47% of returns (\$0.16) during this period. This means the inflation-adjusted real return of our \$1 investment is \$-0.24. You may also want to account for capital gains tax, which would take your real return down to around \$0 for most people.

Investment in S&P 500 Index, 1973-1975
Original Amount Final Amount Change
Nominal \$1 \$0.92 -8.04%
Real
\$1 \$0.76 -24.11%

Information displayed above may differ slightly from other S&P 500 calculators. Minor discrepancies can occur because we use the latest CPI data for inflation, annualized inflation numbers for previous years, and we compute S&P price and dividends from January of 1973 to latest available data for 1975 using average monthly close price.

For more details on the S&P 500 between 1973 and 1975, see the stock market returns calculator.

Politics and news often influence economic performance. Here's what was happening at the time:

• President Richard Nixon announces the end of the Vietnam War.
• The longest war in American history finishes after William Rogers and Nguyen Duy Trinh of US and North Vietnam's army sign a cease-fire.
• The IRA attacks London for the first time following the arrests of 10 of its members.
• The Senate Watergate Committee begins its hearings.

### Data Source & Citation

Raw data for these calculations comes from the Bureau of Labor Statistics' (CPI), established in 1913. Inflation data from 1665 to 1912 is sourced from a historical study conducted by political science professor Robert Sahr at Oregon State University.

You may use the following MLA citation for this page: “\$1 in 1973 → 1975 | Inflation Calculator.” Official Inflation Data, Alioth Finance, 5 Apr. 2020, https://www.officialdata.org/1973-dollars-in-1975?amount=1.