If the nominal interest rate was 12 percent and the inflation rate was 10 percent in 1980, while the nominal interest rate was 7 percent and the inflation rate was 2 percent in 2001, then

The percent change formula is amount of change divided by original number

so 7/8-3/8 = the amount of change or 4/8

4/8 divided by the original number (3/8)

to divide fractions you multiply the first fraction by the reciprocal of the second number

7/8*8/3 = 7/1 * 1/3 = 7/3

do 7/3 in a calculator = 2.33 repeating

move the decimal two places to the right

and the percent change is a 233% increase