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Inflation causes things to cost more, and for our money to buy less. Suppose inflation decreases the value of money by 1.1% each

year.
How much will $ 200 buy you in 14 years?


PLEASE HELP!!!

User Puffpio
by
6.9k points

1 Answer

3 votes

Answer: $171.31

Explanation:

A = P(1 - r)ⁿ

Given: P = 200, r = 1.1% (.011), n = 14

A = 200(1 - .011)¹⁴

= 200(.989)¹⁴

= 171.308

Since we are talking about money, round to two decimal places.

User Nikhil Mohadikar
by
7.4k points
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