# \$1 in 1981 is worth \$0.74 in 1981

\$

## Value of \$1 from 1985 to 1981

According to the Bureau of Statistics consumer price index, prices in 1981 are 26.28% lower than average prices since 1985. The Australian dollar experienced an average inflation rate of 7.92% per year during this period, causing the real value of a dollar to decrease.

In other words, \$1 in 1985 is equivalent in purchasing power to about \$0.74 in 1981, a difference of \$-0.26 over 4 years.

The 1981 inflation rate was 9.47%. The inflation rate in 1985 was 6.52%. The 1985 inflation rate is higher compared to the average inflation rate of 3.17% per year between 1985 and 2020.

 Cumulative price change -26.28% Average inflation rate 7.92% Converted amount (\$1 base) \$0.74 Price difference (\$1 base) \$-0.26 CPI in 1985 39.200 CPI in 1981 28.900 Inflation in 1981 9.47% Inflation in 1985 6.52%

AUD Inflation since 1922
Annual Rate, the Bureau of Statistics CPI

## Buying power of \$1 in 1981

This chart shows a calculation of buying power equivalence for \$1 in 1981 (price index tracking began in 1922).

For example, if you started with \$1, you would need to end with \$0.74 in order to "adjust" for inflation (sometimes refered to as "beating inflation").

When \$1 is equivalent to \$0.74 over time, that means that the "real value" of a single Australian 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 1981 dollars, the chart below shows how \$1 is worth less over 4 years.

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

Dollar inflation: 1981-1985
Year Dollar Value Inflation Rate
1981 \$1.00 9.47%
1982 \$1.11 11.07%
1983 \$1.22 10.28%
1984 \$1.27 3.95%
1985 \$1.36 6.52%
1986 \$1.48 9.18%
1987 \$1.61 8.41%
1988 \$1.72 7.33%
1989 \$1.85 7.43%
1990 \$1.99 7.48%
1991 \$2.05 3.13%
1992 \$2.07 1.01%
1993 \$2.11 1.67%
1994 \$2.15 1.97%
1995 \$2.25 4.67%
1996 \$2.31 2.62%
1997 \$2.31 0.30%
1998 \$2.33 0.75%
1999 \$2.37 1.48%
2000 \$2.47 4.53%
2001 \$2.58 4.34%
2002 \$2.66 3.08%
2003 \$2.73 2.73%
2004 \$2.80 2.28%
2005 \$2.87 2.72%
2006 \$2.97 3.49%
2007 \$3.04 2.33%
2008 \$3.18 4.44%
2009 \$3.23 1.74%
2010 \$3.33 2.89%
2011 \$3.44 3.33%
2012 \$3.49 1.71%
2013 \$3.58 2.48%
2014 \$3.67 2.51%
2015 \$3.73 1.51%
2016 \$3.78 1.30%
2017 \$3.85 1.92%
2018 \$3.90 1.26%
2019 \$3.97 1.90%
2020 \$4.05 1.90%*
* Compared to previous annual rate. Not final. See inflation summary for latest 12-month trailing value.

This conversion table shows various other 1981 amounts in 1985 dollars, based on the -26.28% change in prices:

Conversion Table: Value of a dollar in 1985
Initial value Equivalent value
\$1 dollar in 1981 \$1.36 dollars in 1985
\$5 dollars in 1981 \$6.78 dollars in 1985
\$10 dollars in 1981 \$13.56 dollars in 1985
\$50 dollars in 1981 \$67.82 dollars in 1985
\$100 dollars in 1981 \$135.64 dollars in 1985
\$500 dollars in 1981 \$678.20 dollars in 1985
\$1,000 dollars in 1981 \$1,356.40 dollars in 1985
\$5,000 dollars in 1981 \$6,782.01 dollars in 1985
\$10,000 dollars in 1981 \$13,564.01 dollars in 1985
\$50,000 dollars in 1981 \$67,820.07 dollars in 1985
\$100,000 dollars in 1981 \$135,640.14 dollars in 1985
\$500,000 dollars in 1981 \$678,200.69 dollars in 1985
\$1,000,000 dollars in 1981 \$1,356,401.38 dollars in 1985

## How to Calculate Inflation Rate for \$1, 1981 to 1985

Our calculations use the following inflation rate formula to calculate the change in value between 1981 and 1985:

CPI in 1981 CPI in 1985
×
1985 AUD value
=
1981 AUD value

Then plug in historical CPI values. The Australian CPI was 39.2 in the year 1985 and 28.9 in 1981:

28.939.2
×
\$1
=
\$0.74

\$1 in 1985 has the same "purchasing power" or "buying power" as \$0.74 in 1981.

To get the total inflation rate for the 4 years between 1981 and 1985, we use the following formula:

CPI in 1981 - CPI in 1985CPI in 1985
×
100
=
Cumulative inflation rate (4 years)

Plugging in the values to this equation, we get:

28.9 - 39.239.2
×
100
=
-26%

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

• Mikhail Gorbachev replaces Konstantin Chernenko as leader of the Soviet Union.
• Earthquake with a magnitude of 8.1 rocks Mexico City and kills 10,000 people, leaving over 250,000 homeless.
• Mikhail Gorbachev (leader of the Soviet Union) and Ronald Reagan (President of the United States) meet for the first time.
• Ernie Wise makes the first mobile phone call in the UK.

## Data Source & Citation

Raw data for these calculations comes from the government of Australia's annual (CPI) as provided by the Reserve Bank of Australia. The consumer price index was established in 1922 and is tracked by Australian Bureau of Statistics (ABS).

You may use the following MLA citation for this page: “\$1 in 1985 → 1981 | Australia Inflation Calculator.” Official Inflation Data, Alioth Finance, 4 Jun. 2020, https://www.officialdata.org/australia/inflation/1985?amount=1&endYear=1981.