An engineer who is now 65 years old began planning for retirement 40 years ago. At that time, he thought that if he had $1 million when he retired, he would have more than enough money to live his remaining life in luxury. Assume the inflation rate over the 40-year time period averaged a constant 4.7% per year.

a) What is the CV purchasing power of his $1 million at age 65? (Hint: Use the day he started 40 years ago as the base year.)

The CV purchasing power is $ .

b) How many future dollars should he have accumulated over the 40 years to have a CV purchasing power equal to $1.9 million at his current age of 65?

To have a CV purchasing power of $1.9 million, he should have accumulated $ future dollars.