College Algebra (10th Edition)

Published by Pearson
ISBN 10: 0321979478
ISBN 13: 978-0-32197-947-6

Chapter 6 - Section 6.7 - Financial Models - 6.7 Assess Your Understanding - Page 476: 58


${{\$}} 941.19$

Work Step by Step

Inflation: The amount A that ${{\$}} P$ can purchase after n years, with annual inflation rate r (decimal) is $A=P\cdot(1-r)^{n}$ --- $P=1000,r=0.02,n=3$ $A=1000(1-0.02)^{3}\approx {{\$}} 941.19$
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