My boss asked a simple question today but I couldn't find the right answer.

He asked: If I had \$5,000 today in cash, the inflation is 2% year-over-year, then then what's its buying power (value) after 50 years?

If I use the following formula: $5000 \* (1-0.02)^{50}$ I get \$1820.

However if I use inflation calculator (at this website <http://www.buyupside.com/calculators/inflationjan08.htm>) that uses present value/future value formula, I get a different result: $\frac{5000}{(1+0.02)^{50}}$ I get \$1,857.

Which formula is correct and why?