Mr. Art Deco will be paid $200,000 one year hence. This is a nominal flow, which he discounts at an 8% nominal discount rate:

200,000 PV= ----------- = $185,185 1.08

The inflation rate is 3%.

Calculate the PV of Mr. Decos payment using the equivalentrealcash flow andrealdiscount rate.(You should get exactly the same answer as he did.)(Do not round intermediate calculations.Round your "Real cash flow" and "Present value" answers to the nearest dollar amount and "Real discount rate"answer to 2 decimal places.)

Real cash flow $? Real discount rate % ?

Present value $?