Required information Assume the market interest rate is 8% per year and inflation averages 5.4% per year. If the amounts had been quoted in CV dollars, what is the annual worth in future dollars? The annual worth in future dollars is $[

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Chapter1: Making Economics Decisions
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i got the perpetual eq. annual worth but i dont know how to find annual worth.
please explain with steps and give the answer.

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Required information
Assume the market interest rate is 8% per year and inflation averages 5.4% per year.
Calculate the perpetual equivalent annual worth in future dollars for years 1 through ∞ for an income of $69,000 now and $5000 per
year thereafter.
The perpetual equivalent annual worth is $ 10520 future dollars.
Transcribed Image Text:2 Required information Assume the market interest rate is 8% per year and inflation averages 5.4% per year. Calculate the perpetual equivalent annual worth in future dollars for years 1 through ∞ for an income of $69,000 now and $5000 per year thereafter. The perpetual equivalent annual worth is $ 10520 future dollars.
2
Required information
Assume the market interest rate is 8% per year and inflation averages 5.4% per year.
Calculate the perpetual equivalent annual worth in future dollars for years 1 through ∞ for an income of $69,000 now and $5000 per
year thereafter.
The perpetual equivalent annual worth is $ 10520 future dollars.
Transcribed Image Text:2 Required information Assume the market interest rate is 8% per year and inflation averages 5.4% per year. Calculate the perpetual equivalent annual worth in future dollars for years 1 through ∞ for an income of $69,000 now and $5000 per year thereafter. The perpetual equivalent annual worth is $ 10520 future dollars.
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