When a language model fails to answer a query on the first attempt, an agentic system retries, consuming additional tokens each time. This retry overhead creates a gap between what a model's per-token price implies and what a full workflow actually costs. We call this gap \emph{token inflation} and define it as the ratio of true workflow cost to single-call cost. Systems like FrugalGPT route based on the latter, which can underestimate real cost by more than $2\times$ on difficult tasks. We address this with InflationAgent, a four-stage router that (1) measures token inflation systematically across model tiers and task types, finding inflation as high as $4.25\times$ for a 7B model on multi-hop question answering; (2) introduces CoT Branching Entropy (CBE), a pre-execution difficulty signal computed entirely from local inference, which predicts high inflation with AUROC 0.887; and (3) selects models by maximizing a Semantic Exchange Rate (SER) that divides expected accuracy by predicted true cost, with a fresh-escalation policy that discards failed chains before routing to a stronger model. On GSM8K under a fixed budget, InflationAgent achieves 94.7\% accuracy versus 91.0\% for FrugalGPT while using 31\% fewer tokens, and we show that forwarding a failed reasoning chain to GPT-4o reduces its accuracy by up to 34.8 percentage points, validating the fresh-escalation design.
Quantization is widely used to reduce the inference cost of large language models, but its effect on reasoning models is not fully captured by final-answer accuracy or per-token latency. We show that low-bit post-training quantization can introduce a hidden test-time compute cost: quantized reasoning models often generate longer chains of thought even when they still answer correctly. Across mathematical reasoning, code generation, scientific question answering, and agentic tool-use benchmarks, we find that INT4/INT3 quantization can preserve accuracy but increase reasoning-token usage, offsetting the expected per-token speedup. To measure this effect, we introduce the CoT Token Inflation Ratio, which compares reasoning length between quantized and full-precision models averaged across all evaluation benchmarks. We further show that token inflation is accompanied by behavioral changes in the reasoning trace, including more intermediate steps and greater semantic repetition. These changes translate into measurable end-to-end real-world serving penalties. Finally, we evaluate mitigation strategies and find that prompting and decoding-time sampling offer inconsistent accuracy-length trade-offs, while quantization-aware training shows more promise in reducing both accuracy degradation and token inflation. Our results suggest that reasoning-token usage should be reported alongside accuracy when evaluating quantized reasoning models.