Paul just graduated from college and landed his first "real" job, which pays 37,900 a year. In 13 years, what will he need to earn to maintain the same purchasing power of inflation averages 3 percent?

Salary = $55,656.15

Explanation:

Giving the following information:

Paul just graduated from college and landed his first "real" job, which pays 37,900 a year.

n = 13 years

inflation = 3% annually

First, we need to calculate the total inflation of the 13 years:

accumulated inflation = 1.03^13 = 1.4685

Now, we can calculate the amount necessary to maintain the purchasing power:

Salary = 37,900*1.4685 = $55,656.15