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he purchasing power P (in dollars) of an annual amount of A dollars after t years of 5% inflation decays according to the following formula.
he purchasing power P (in dollars) of an annual amount of A dollars after t years of 5% inflation decays according to the following formula.
P = Ae0.05t
(a) How long will it be before a pension of $70,000 per year has a purchasing power of $30,000? (Round your answer to two decimal places.)
(b) How much pension A would be needed so that the purchasing power P is $50,000 after 19 years? (Round your answer to the nearest dollar.)
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