Question

The inflation rate of the U.S. dollar is 3.1 percent. What this means is that every year, prices increase by 3.1 percent. If a paperback book cost $1.98 three years ago, what does it cost now?

Answer 1

The answer should be $2.04

Answer 2

3.1 = 0.031

0.031 x 3 = 0.093

1.98 x 0.093 = 0.18414

0.18414 + 1.98 = 2.16