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April 27th, 2017, 04:37 AM  #1 
Newbie Joined: Apr 2017 From: Perth Posts: 1 Thanks: 0  Answer to a formula
Hello. I am new to this forum but would appreciate advice. I am having an issue with a solicitor about a formula contained in a draft lease to increase the rent. The formula is supposed to increase the rent by 1.5% above the rate of CPI inflation using the following formula: NR = R+R(CPI%+P) Where NR = new rent R= Rent before review CPI = CPI P= Percentage increase Assuming R=10,000 and CPI =2 and P=1.5 is the following calculation correct? NR= 10,000 +10,000(2+1.5) NR= 10,000 + 10,000(3.5) NR = 10,000 + 35,000 NR = 45,000 If my working above is correct then the formula is incorrect. I will be interested to see if I am correct as it is 30 years since I did maths in school! Thank you in advance for any replies. 
April 27th, 2017, 05:27 AM  #2 
Math Team Joined: Jul 2011 From: Texas Posts: 3,016 Thanks: 1600 
NR = R + R(CPI + P) = R(1 + CPI + P) If CPI = 2%, then the formula entry would be 0.02, not 2. Same for P = 1.5% ... entry value for P would be 0.015, not 1.5. NR = 10000(1.035) = 10350 

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