Refer to problem find the present value of a continuous, Ask an Expert

Management Studies

Refer to Problem. Find the present value of a continuous income stream at 7.65%, compounded continuously for 12 years, if the rate of flow is f(t) = 1,000e^0.03t.

Problem :-
A business is planning to purchase a piece of equipment that will produce a continuous stream of income for 8 years with rate of flow f(t) = 9,000. If the continuous income stream earns 6.95%, compounded continuously, what single deposit into an account earning the same interest rate will produce the same future value as the continuous income stream?

(This deposit is called the present value of the continuous income stream.)

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Business Management, Management Studies

Category:- Business Management
Reference No.:- M92024604

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