AFMAN65-502 governs inflation adjustments, rates, indices, and dollar conversions in Air Force planning, budgeting, analysis, and reporting.
View AFMAN65-502 on armypubs.army.mil
It explains inflation, market changes, the value of the dollar, and the use of inflation indices to normalize cost data. It requires application of OUSD(C) inflation and escalation rates and describes how SAF/FMC generates and distributes inflation indices.
Applies to: It applies to individuals/organizations at all levels who apply inflation as described in this manual, including Air Force Reserve and Air National Guard (ANG) units, except where noted otherwise.
The inflation index is intended to measure the decrease in the value of the dollar … nothing else.
“Normalizing” for inflation means applying the inflation index to cost data in order to remove the effect of inflation.
Anything that moves the supply and/or demand curve for a good or service will change the equilibrium price for that good or service.
Market changes are important since they can create changes in individual prices that are above or below the level of inflation.
Ensure all records created as a result of processes prescribed in this publication are maintained in accordance with Air Force Manual 33-363, Management of Records, and disposed of in accordance with the Air Force Records Disposition Schedule located in the Air Force Records Information Management System.