2. Assume a fund accumulates at a force of interest given by 6 .02t. Find the effective rate of interest during the second year. What is the value at time t = 5 of an investment of 1000 made at time t= 2.
2. Assume a fund accumulates at a force of interest given by 6 .02t. Find the effective rate of interest during the second year. What is the value at time t = 5 of an investment of 1000 made at time t= 2.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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An introductory course for actuaries, I hope to get a detailed answer process and ideas. I gave the correct answer, I just want the process.
Transcribed Image Text:2. Assume a fund accumulates at a force of interest given by & = .02t. Find the effective rate
of interest during the second year. What is the value at time t = 5 of an investment of 1000
made at time t = 2.
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Answers: 3.045%, 1233.68
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