Problem 10.52
If the market interest rate is 12% per year and the inflation rate is 5% per year, the
number of future dollars in year 7 that will be equivalent to $2000 now can be
determined by the relation:
a. F = 2000(1 + 0.176)7
b. F = 2000/(1 + 0.176)7
c. F = 2000(1 + 0.120)7
d. F = 2000(1 + 0.198)7