(b) A company has an income stream with rate of income given by f(t) = 1 – 0.02t measured in millions of dollars per annum, with t measured in years and t = 0 corresponds to today. If money can earn interest at a rate of 4% p.a. compounded continuously, what is the present value of the income stream over the next 10 years?

Calculus: Early Transcendentals
8th Edition
ISBN:9781285741550
Author:James Stewart
Publisher:James Stewart
Chapter1: Functions And Models
Section: Chapter Questions
Problem 1RCC: (a) What is a function? What are its domain and range? (b) What is the graph of a function? (c) How...
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(b) A company has an income stream with rate of income given by
f(t) = 1 – 0.02t
measured in millions of dollars per annum, with t measured in years and
t = 0 corresponds to today. If money can earn interest at a rate of 4% p.a.
compounded continuously, what is the present value of the income stream
over the next 10 years?
Transcribed Image Text:(b) A company has an income stream with rate of income given by f(t) = 1 – 0.02t measured in millions of dollars per annum, with t measured in years and t = 0 corresponds to today. If money can earn interest at a rate of 4% p.a. compounded continuously, what is the present value of the income stream over the next 10 years?
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