The formula to calculate the Cost Increase Per Year is:
\[ \text{CIPY} = \frac{\text{CI}}{\text{Y}} \]
Where:
Cost Increase Per Year (CIPY) is the average annual increase in cost over a specified period. It is calculated by dividing the total cost increase by the number of years. This metric helps in understanding the rate at which costs are rising annually.
Let's assume the following values:
Using the formula:
\[ \text{CIPY} = \frac{5000}{5} = 1000 \, \text{\$/year} \]
The Cost Increase Per Year is $1000/year.
Let's assume the following values:
Using the formula:
\[ \text{CIPY} = \frac{12000}{3} = 4000 \, \text{\$/year} \]
The Cost Increase Per Year is $4000/year.
