Question

Paul just graduated from college and landed his first​ "real" job, which pays ​37,900 a year. In 13 ​years, what will he need to earn to maintain the same purchasing power of inflation averages 3 ​percent?

Answer 1

Salary= $55,656.15

Step-by-step explanation:

Giving the following information:

Paul just graduated from college and landed his first​ "real" job, which pays ​37,900 a year.

n= 13 years

inflation= 3% annually

First, we need to calculate the total inflation of the 13 years:

accumulated inflation= 1.03^13= 1.4685

Now, we can calculate the amount necessary to maintain the purchasing power:

Salary= 37,900*1.4685= $55,656.15