For this discussion, you'll be selecting an item that you purchase and using that price to see the impact inflation has had, and will have, on the price, in nominal dollars. In addition to the price, you'll want to select a few years to compare this change in price. First, you'll want to pick a year in the past. Your birthyear may be a good place to start. Second and third, you'll pick two years in the future. The first future year should be 20 years from now. The second will your expected retirement year. For example, your current age is 20 and you expect to retire at 65, so 65 - 20 = 45. Add this number to the current year to find your year of retirement.

Step 1) Input the price you selected (above) and input it into the textbox. Next, select the current year in the first dropdown box. For the second dropdown box, you'll input your birthyear. Answer the relevant questions below.

Step 2) Input the new dollar value reported in Step 1 (was worth $___) into the text box. Change the first year dropdown box to your birth year, then change the second dropdown box to twenty years from now. Answer the relevant questions below. (Note: Notice that you can also change the expected (future) rate of inflation, too. Feel free to change it to see the effects. You can use this website to find the current annual inflation rate: https://www.usinflationcalculator.com/inflation/current-inflation-rates/Links to an external site.)

Step 3) Change the last dropdown box to the year you expect to retire. Answer the relevant questions below.

• What item did you choose and what price did you use? What year in the past did you use?
• Report the price of the item in the past. Also report the average and cumulative inflation rate over this time period. (This is reported below the dropdown boxes.)
• What did you notice about the effects of inflation on this item? Was the item cheaper in the past or more expensive?
• Your second paragraph should answer the following...
  • Looking now into the future, what is the expected price 20 years from now? How has the price changed?
  • Next, what is the expected price of the item at the time of your retirement? How has the price changed from now and also 20 years from now?
  • Has this changed your view on how to plan or save for the future? Why or why not?