1. What annual deposit is required for 5 years to accumulate an amount of money with the same purchasing power as $680.58 today, if the market interest rate is I 0% per year and inflation is 8% per year?
2. Describe how to convert inflated dollars into constant-value dollars.
3. What is the inflation rate if something costs exactly twice as much as it did 1O years earlier?
1. Convert $10,000 present dollars into then-current dollars of year 10 if the inflation rate is 7% per year.
2. Convert $ 1 0,000 future dollars in year 10 into constant- value dollars (not equivalent dollars) of today if the inflation adjusted (market) interest rate is J 1 % per year and the inflation rate is 7% per year.
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