Sep'16 examiners report

He could actual mean several things, but without seeing the question (because it has not been published) it is impossible to be certain. What he is probably referring to is this: Suppose a flow has a current price of 100 per year. Suppose inflation is 5% in the first year and 6% in the second year. Then the actual cash flow at time 1 will be 100 x 1.05 = 105 The actual cash flow at time 2 will be 100 x 1.05 x 1.06 = 111.3

ok, thank you, John

You are welcome :-)