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These prices may seem cheap but they were not - "back in the day." This is due to inflation. In a growing economy, most goods and services increase in price over time - to the tune of 2%-3% each year. The key is that workers' wages also increase. Thus, a car may have only cost $500 at some point in the past, but the average worker's salary was much, much lower back then. The inflation formula can be used to predict the future price of a good or service. The inflation formula is given by FV = PV(1 +r)* where FV is the future value of the good or service, PV is the present value of the good or service, r is the inflation rate, and t is number of years desired. Suppose the average four-year college degree at a public university costs $10,275 today and college inflation averages 5.81% per year. Use the inflation formula to predict what an average four-year college degree at a public university will cost years from now. Round the solution to the nearest cent. $ Suppose the average loaf of bread costs $3.96 today and grocery inflation averages 2.78% per year. Use the inflation formula to predict what an average loaf of bread will cost 26 years from now. Round the solution to the nearest cent.

These prices may seem cheap but they were not - "back in the day." This is due to inflation. In a growing economy, most goods and services increase in price over time - to the tune of 2%-3% each year. The key is that workers' wages also increase. Thus, a car may have only cost $500 at some point in the past, but the average worker's salary was much, much lower back then. The inflation formula can be used to predict the future price of a good or service. The inflation formula is given by FV = PV(1 +r)* where FV is the future value of the good or service, PV is the present value of the good or service, r is the inflation rate, and t is number of years desired. Suppose the average four-year college degree at a public university costs $10,275 today and college inflation averages 5.81% per year. Use the inflation formula to predict what an average four-year college degree at a public university will cost years from now. Round the solution to the nearest cent. $ Suppose the average loaf of bread costs $3.96 today and grocery inflation averages 2.78% per year. Use the inflation formula to predict what an average loaf of bread will cost 26 years from now. Round the solution to the nearest cent.

Trigonometry (MindTap Course List)
Trigonometry (MindTap Course List)
10th Edition
ISBN:9781337278461
Author:Ron Larson
Publisher:Ron Larson
Chapter5: Exponential And Logarithmic Functions
Section5.5: Exponential And Logarithmic Models
Problem 1ECP
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"Back in my day..." Young people hate hearing older folks say how things were so much cheaper when they were young. A gallon of gas? 25 cents. A Coca-cola? 5 cents. A car? 500 bucks. These prices may seem cheap - but they were not - "back in the day." This is due to inflation. In a growing economy, most goods and services increase in price over time to the tune of 2%-3% each year. The key is that workers' wages also increase. Thus, a car may have only cost $500 at some point in the past, but the average worker's salary was much, much lower back then. The inflation formula can be used to predict the future price of a good or service. The inflation formula is given by FV PV (1 + r) where FV is the future value of the good or service, PV is the present value of the good or service, r is the inflation rate, andt is number of years desired.
Transcribed Image Text:"Back in my day..." Young people hate hearing older folks say how things were so much cheaper when they were young. A gallon of gas? 25 cents. A Coca-cola? 5 cents. A car? 500 bucks. These prices may seem cheap - but they were not - "back in the day." This is due to inflation. In a growing economy, most goods and services increase in price over time to the tune of 2%-3% each year. The key is that workers' wages also increase. Thus, a car may have only cost $500 at some point in the past, but the average worker's salary was much, much lower back then. The inflation formula can be used to predict the future price of a good or service. The inflation formula is given by FV PV (1 + r) where FV is the future value of the good or service, PV is the present value of the good or service, r is the inflation rate, andt is number of years desired.
These prices may seem cheap but they were not - "back in the day." This is due to inflation. In a growing economy, most goods and services increase in price over time to the tune of 2%-3% each year. The key is that workers' wages also increase. Thus, a car may have only cost $500 at some point in the past, but the average worker's salary was much, much lower back then. The inflation formula can be used to predict the future price of a good or service. The inflation formula is given by FV = PV(1+r)* where FV is the future value of the good or service, PV is the present value of the good or service, r is the inflation rate, and t is number of years desired. Suppose the average four-year college degree at a public university costs $10,275 today and college inflation averages 5.81% per year. Use the inflation formula to predict what an average four-year college degree at a public university will cost 38 years from now. Round the solution to the nearest cent. $4 Suppose the average loaf of bread costs $3.96 today and grocery inflation averages 2.78% per year. Use the inflation formula to predict what an average loaf of bread will cost 26 years from now. Round the solution to the nearest cent. Chp
Transcribed Image Text:These prices may seem cheap but they were not - "back in the day." This is due to inflation. In a growing economy, most goods and services increase in price over time to the tune of 2%-3% each year. The key is that workers' wages also increase. Thus, a car may have only cost $500 at some point in the past, but the average worker's salary was much, much lower back then. The inflation formula can be used to predict the future price of a good or service. The inflation formula is given by FV = PV(1+r)* where FV is the future value of the good or service, PV is the present value of the good or service, r is the inflation rate, and t is number of years desired. Suppose the average four-year college degree at a public university costs $10,275 today and college inflation averages 5.81% per year. Use the inflation formula to predict what an average four-year college degree at a public university will cost 38 years from now. Round the solution to the nearest cent. $4 Suppose the average loaf of bread costs $3.96 today and grocery inflation averages 2.78% per year. Use the inflation formula to predict what an average loaf of bread will cost 26 years from now. Round the solution to the nearest cent. Chp
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