SOLUTION: Inflation causes things to cost more, and for our money to buy less (hence your grandparents saying "In my day, you could buy a cup of coffee for a nickel"). Suppose inflation decr

Question 1109427: Inflation causes things to cost more, and for our money to buy less (hence your grandparents saying "In my day, you could buy a cup of coffee for a nickel"). Suppose inflation decreases the value of money by 5% each year. In other words, if you have $1 this year, next year it will only buy you $0.95 worth of stuff. How much will $100 buy you in 20 years?
Answer by josmiceli(19441) (Show Source): You can put this solution on YOUR website!
Let = value of the money
after 20 yrs

In 20 yrs $100 is worth $35.85

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