Suppose the value of a new financial security increases with time, such that one dollar of the financial currency at year 0 is worth V(t) = exp{2√7-0.15t} dollars at time t. If the interest rate is 10 percent, after how many years should the financia asset be sold in order to maximize the PDV of the sale? (NOTE: Write your answer in number format, with 2 decimal places of precision level; do not write your answer as a fraction. Add a leading zero and trailing zeros when needed. Use a period for the decimal separator and a comma to separate groups of thousands.)

Suppose the value of a new financial security increases with time, such that one dollar of the financial currency at year 0 is worth V(t) = exp{2√7-0.15t} dollars at time t. If the interest rate is 10 percent, after how many years should the financia asset be sold in order to maximize the PDV of the sale? (NOTE: Write your answer in number format, with 2 decimal places of precision level; do not write your answer as a fraction. Add a leading zero and trailing zeros when needed. Use a period for the decimal separator and a comma to separate groups of thousands.)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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