Assume that inflation in Canada keeps increasing at the steady rate of 2% per year. You...
Assume that inflation in Canada keeps increasing at the steady rate of 2% per year. You buy $120 worth of groceries today, in 2020. How much would you have to pay for the same groceries in 2035? Round off to the nearest cent.
Homework Answers
Inflation is increasing at a steady rate of 2% per year.
The price of groceries in 2020 is $120.
The number of years between 2020 and 2035 is 15.
Price for the same groceries in 2035 = $120 (1 + inflation rate)^number of year.
Price for the same groceries in 2035 = $120 (1+0.02)^15
Price for the same groceries in 2035 = $161.504
Price for the same groceries in 2035 = $161.50
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