The inflation rate of the u. s. dollar is 3.7 percent. what this means is that every year, prices increase by 3.7 percent. If a quart of oil cost $1.69 five years ago, how much does it cost now?.

Question

Mathematics

Alijah Savage

21 February, 07:57

The inflation rate of the u. s. dollar is 3.7 percent. what this means is that every year, prices increase by 3.7 percent. If a quart of oil cost $1.69 five years ago, how much does it cost now?.

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Answers (2)

Know the Answer?

Jonathon Clark · Answer 1

1.69 * (1.037) 5 ...

Davin Moses · Answer 2

After n years, the price of a good in US in calculated through the equation,

an = (a1) x (1 + r) ^n

Substituting the known values from the given,

an = ($1.69) x (1 + 0.037) ^5 = $2.03

Thus, the oil will cost $2.03 today.