Question: Inflation. The purchasing power P (in dollars) of an annual amount of A dollars after t years of 5% inflation decays according to P = Ae-0.05t (Source: Viewpoints, VALIC)
(a) How long will it be before a pension of $60,000 per year has a purchasing power of $30,000?
(b) How much pension A would be needed so that the purchasing power P is $50,000 after 15 years?