$100 in 1973 is worth $242 in 1985,
because prices increased 142.3% over that period, an average of
7.66% a year.
$100 in 1973 has
the same buying power as
$242
in 1985
Detailed inflation statistics
Cumulative price change
142.3%
Average inflation rate
7.66% per year
Converted amount ($100 base)
$242
Price difference ($100 base)
$142
CPI in 1973
44.4
CPI in 1985
107.6
Inflation in 1973
6.22%
Inflation in 1985
3.56%
$100 in 1973 → 1985
$242
$100 in 1985 → 1973
$41.26
What happened to prices between 1973 and 1985
Between 1973 and 1985, the Consumer Price Index went from 44.4 to 107.6.
Cumulatively, prices increased 142.3%, which works out to an average of
7.66% per year. Put differently, a dollar in 1973 bought what
$0.41 buys in 1985: the 1973 dollar
lost 58.7% of its purchasing power over
these 12 years.
Consumer prices rose 6.2% in 1973, nearly double 1972’s 3.2%,
as Nixon’s wage and price controls were phased out through the year and
pressure the controls had been holding back broke loose. The bigger shock
arrived that October, when Arab oil-producing states embargoed exports to the
United States and other supporters of Israel in the Yom Kippur War. Crude
oil, which had traded around $3 a barrel, approached $12 by early 1974, and
gas lines became a fixture outside filling stations nationwide. Earlier in
the year, the Paris Peace Accords, signed that January 27, ended direct
American combat in Vietnam and set a 60-day deadline for withdrawing
remaining U.S. troops, even as fighting between North and South Vietnam went
on. Financial markets read the year correctly as a turning point: the Dow
Jones Industrial Average peaked at 1,051.70 on January 11, a level it would
not reach again until 1980, before the oil shock and rising interest rates
dragged it into a two-year bear market. A median household earned $10,512 in
1973, a new home sold for a median $32,500, and gas averaged 38.5 cents a
gallon, still under half of what the embargo’s effects would bring the
following year. Consumer prices stood 348.5% above their
1913 level by year’s end, with the decade’s worst inflation
still ahead.
Every 1973 amount converts to 1985 at the same ratio, 2.42: $1,000 becomes
$2,423, and $10,000 becomes $24,234.
Amount in 1973
Value in 1985
$1.00
$2.42
$5.00
$12.12
$10.00
$24.23
$20.00
$48.47
$50.00
$121
$100
$242
$500
$1,212
$1,000
$2,423
$5,000
$12,117
$10,000
$24,234
$100,000
$242,342
$1,000,000
$2,423,423
Inflation by spending category, 1973–1985
Between 1973 and 1985, energy rose the most, up 245.6%, while apparel rose the least, up 62.5%, against 142.3% for all items. The headline number is an average; here is what $100 of 1973
spending costs in 1985, by category:
Category
Avg. yearly inflation
$100 in 1973 →
All items (CPI-U)
7.66%
$242
Energy
10.89%
$346
Medical care
9.36%
$293
Housing
8.34%
$261
Transportation
8.23%
$258
Core (all items less food & energy)
7.54%
$239
Food
6.75%
$219
Apparel
4.13%
$163
Not shown because the BLS began these indexes after 1973: recreation (1993–), education & communication (1993–).
Decade by decade: 1973 to 1985
Prices climbed fastest in the 1970s, averaging 9.24% a year, and slowest in the 1980s (5.48% a year). Each step below chains into the full 1973–1985 change:
Years
Avg. yearly inflation
Price change
$100 from 1973, at end
1973–1980
9.24%
85.6%
$186
1980–1985
5.48%
30.6%
$242
Year by year: CPI and the value of $100 from 1973
$100 from 1973 had already become $164 by
1979, on its way to $242 in 1985; each row shows the CPI, that
year's inflation rate, and the running value.
Within the span, inflation peaked at 13.5% in 1980, and the smallest rise was 3.2% in 1983.
In 1985, prices rose 3.6% and $100 from 1973 had the buying
power of $242; the year's average CPI of 107.6 is the level
behind every 1985 figure on this page.
By 1985, low inflation had become the norm rather than the exception.
Consumer prices rose 3.6% for the year, the fourth straight year in the
3-6% range following the double-digit spikes of 1980 and 1981, proof that
the disinflation had held rather than merely paused, as it had after
previous recessions. Overseas, the dollar had become a problem of its own:
years of high U.S. interest rates had pulled in foreign capital and pushed
the dollar’s value up so far that American exporters were losing business
abroad, widening the trade deficit. In September, the finance ministers of
the U.S., Japan, West Germany, France, and the United Kingdom met at New
York’s Plaza Hotel and agreed to coordinate a managed decline of the
dollar; it fell roughly 25% against major currencies over the following two
years. At home, Congress responded to a federal deficit that had roughly
tripled since 1980 by passing the Gramm-Rudman-Hollings Act in December,
setting binding targets to shrink the deficit with automatic
across-the-board cuts if lawmakers missed them. Households felt the calmer
economy in small ways: first-class postage rose to 22 cents in February,
its first increase since November 1981, after nearly four years at 20
cents.
MLA: “Inflation from 1973 to 1985: $100 is worth $242 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1973-to-1985/
APA: InflationCalculator.com. Inflation from 1973 to 1985. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1973-to-1985/