The Consumer Price Index (CPI) determines the overall increase in prices for goods consumed (a.k.a. consumer goods) in a given economy.
On a wide-scale, CPI is a calculation performed by the U.S. Bureau of Labor Statistics (BLS) and is calculated on a monthly basis. They utilize the following formula:
Why do we multiply the result of this by 100?
Because the base, or starting point, for CPI is at 100.
The base / starting point / index for CPI is 100.
If a basket of consumer goods does not change from one year to the next, then its CPI would remain at 100.