If the rate of inflation is expected to be 2.75% per year for the next five years, what hourly rate would a student earning $10 per hour today have to make in five years in order to have the same purchasing power?

Rate of Inflation

The percentage rate at which the general level of prices for goods and services is rising, and subsequently, purchasing power is falling.

Purchasing Power

An individual's or entity's ability to buy goods and services, affected by inflation and personal financial situation.

Hourly Rate

The sum of money received or given out for every hour worked.