ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Chapter 14, Problem 38P
To determine

The future value of the amount deposited each year and the value of the amount after a year.

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Joe just completed his engineering degree and started to work for an engineering firm. Joe wants to retire early after 30 years working. He plans to invest $5,000 at the end of every year for a 30-year career. If Joe needs $3,954,750 (about $1,400,000 in today's dollars accounting for an expected 3.5% inflation rate) in savings at retirement, what interest rate must the investment earn?
Over the last 10 years, the average rate of inflation has been 1.51%. What is thepurchasing power of a dollar today in terms of what a dollar could purchase in 2012?
If an item costs $200.00 today and the inflation rate is 3%, what will the price be in 10 years?

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ENGR.ECONOMIC ANALYSIS

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