The federal-level Pell Grant program provides financial aid to needy college students. The grant increases annually to account for inflation. The maximum total Pell Grant award increased from $5550 to $5,730 from 2013 to 2015. (a) What was the average inflation rate per year in this prior 2-year period? (b) Beginning in 2018, grants will no longer increase with inflation. What will be the maximum award starting in 2018 and thereafter, assuming the inflation rate in 2016 and 2017 is 2.5% per year?

The federal-level Pell Grant program provides financial aid to needy college students. The grant increases annually to account for inflation. The maximum total Pell Grant award increased from $5550 to $5,730 from 2013 to 2015. (a) What was the average inflation rate per year in this prior 2-year period? (b) Beginning in 2018, grants will no longer increase with inflation. What will be the maximum award starting in 2018 and thereafter, assuming the inflation rate in 2016 and 2017 is 2.5% per year?

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter2: The One Lesson Of Business

Section: Chapter Questions

Problem 2.6IP

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