Inflation Exam
1) You are developing a data base for Army tracked combat vehicles and you are normalizing the data base to base year 2014 dollars. What number would you enter into the data base for a vehicle budgeted at $4,725,000 in the FY18 appropriation? (Use the inflation tables at the end of the chapter.)
$4,223,652
$4,546,640
$4,382,039
$4,382,304
FV=4,725,000/(1+i)^4
whatever i rate you have in the tables.
for instance, say i= 2Percent
FV=( )(1.02)^4== 4365169.64
$4,223,652
$4,382.039
Its $4,223,652 I in DAU these guys BoTS
To answer this question, you need to account for inflation between the base year (2014) and the fiscal year 2018 (FY18).
1. Look up the inflation rate for each year between 2014 and FY18. You can find inflation tables at the end of the chapter.
2. Calculate the cumulative inflation rate by multiplying the inflation rate for each year between 2014 and FY18.
3. Multiply the FY18 budget ($4,725,000) by the cumulative inflation rate to find the equivalent value in 2014 dollars.
4. Compare the calculated value with the given options, and select the one that matches.
Unfortunately, the question does not provide the inflation rate table or the specific inflation rates for each year. Therefore, it is not possible to accurately calculate the correct value using the information given.