·You are planning to invest $ 2,500 today for three years at a nominal interest rate 9 percent with

·      You are planning to invest $ 2,500 today for three years at a nominal  interest rate 9 percent with

annual compounding. What  would be the future value of your investment?

·      Now assume that inflation is expected to be 3 percent per year over the same three-year period.what would be the investment future value in terms of purchasing power?

·      What would be the investment future value in terms of purchasing power if inflation occurs at a 9 percent annual rate?

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