the value will be $121 after two years from now.
Accumulating factor
=FV\PV
=110\100
=1.1
so
Value at two year
=110*1.1
=121.
Inflation is the rate of increase in prices over a period of time. Inflation is usually a broad measure, such as a general rise in prices or an increase in the cost of living in a country.
Inflation occurs when prices across the economy rise and the purchasing power of money fall. For example, in 1980, movie tickets averaged $2.89. By 2019, the median price of movie tickets rose to $9.16.
Although high inflation is generally viewed as detrimental, some economists believe low inflation could boost economic growth. The opposite of inflation is deflation, where prices tend to fall. The Federal Reserve is targeting 2% inflation based on the Consumer Price Index (CPI).
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