Alfredo wants to know how much he must put in a bank account today to achieve an amount equal to $20,000 in today's value (year 0) in 14 years. Inflation is 8%. The interest rate offered by the bank is 5% per year. a) Calculate the conversion to current dollars of the $20,000 $__________ . b) How much should you deposit today in the bank to achieve your goal? $________
Alfredo wants to know how much he must put in a bank account today to achieve an amount equal to $20,000 in today's value (year 0) in 14 years. Inflation is 8%. The interest rate offered by the bank is 5% per year. a) Calculate the conversion to current dollars of the $20,000 $__________ . b) How much should you deposit today in the bank to achieve your goal? $________
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter22: Inflation
Section: Chapter Questions
Problem 37P: Rosalie the Retiree knows that when she retires in 16 years, her company will give her a one-time...
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Alfredo wants to know how much he must put in a bank account today to achieve an amount equal to $20,000 in today's value (year 0) in 14 years. Inflation is 8%. The interest rate offered by the bank is 5% per year. a) Calculate the conversion to current dollars of the $20,000 $__________ . b) How much should you deposit today in the bank to achieve your goal? $________
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