document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=370591>Question 370591</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Inflation is running 2% per year when you deposit $1000 in an account earning interest of 13% per year compounded annually. In constant dollars, how much money will you have two years from now? (Hint: First calculate the value of your account in two years' time, and then find its present value based on the inflation rate. Round your answer to the nearest cent.)<BR>\n" );
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document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #264153 by </B><A HREF=/tutors/aboutme.mpl?userid=robertb><B>robertb(5830)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=robertb><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=robertb><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=264153\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> Not a finance guy, but I understand some of the terms.  If there is 0 inflation for the next 2 years, then the amount in the account is <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=1000%2A%281%2B0.13%29%5E2+=+1000%2A1.13%5E2+=+1276.9 ALIGN=MIDDLE  ALT=\"1000%2A%281%2B0.13%29%5E2+=+1000%2A1.13%5E2+=+1276.9\"   DISABLED_style= \"max-width:90%; height:auto;\" >.  If there is 2% inflation per year, then the value is <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=1000%2A%281.13%29%5E2%2A%280.98%29%5E2+=+1226.33 ALIGN=MIDDLE  ALT=\"1000%2A%281.13%29%5E2%2A%280.98%29%5E2+=+1226.33\"   DISABLED_style= \"max-width:90%; height:auto;\" >. </SPAN>\n" );
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