I Am Considering a Project Which Requires an Immediate Investment

Multiple Choice

I am considering a project which requires an immediate investment of $10 000 and yields a return in two years. If I expect the rate of inflation to be 15%, how big, in actual dollars, must the return be if my real rate of return on the project is to be 20%?

A) $13 500
B) $13 800
C) $14 400
D) $18 225
E) $19 044