The current price of the item is $2500 and the price 10 years from today is $3665. 2.
Given exponential function
p(t) = 2500 × (1.039)^t
where t is the number of years from today.
Rate of inflation is 3.9% per year
The computation of the current price of the item and the price 10 years from today is shown below:-
p(t) = 2500 × (1.039)^t
Now, the current price can be found by putting t = 0
p(0) is
p(0) =
= 2500
The price 10 years from today can be found by putting t = 10
p(10) is
p(10) =
= 2500 × 1.466
= 3,665.181
Rounding to nearest dollar
= $3665. 2
The current price of the item is $2500 and the price 10 years from today is $3665. 2.
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