If inflation averages 3.2% each year from 2015 to 2023, what is the purchasing power in...

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If inflation averages 3.2% each year from 2015 to 2023, what is the purchasing power in...

If inflation averages 3.2% each year from 2015 to 2023, what is the purchasing power in 2015 dollars of $73,000 in 2023?

business economics

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Answer 1

Answer #1

In order to calculate purchasing power, we will use following formula:

current amount= $73000

inflation rate = 3.2%

number of years = 8

so, purchasing power = 73000*(1+3.2%)^8

= 73000*1.2866

= $93,921.8(approx)

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Answer 2

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