(a) To determine To find: The present value of the money for the time period of 10 years at 8% compounded interest where the rate of money flow is f ( t ) = 300 . Explanation Formula used: Present value of money: “Present value at a time T is P = ∫ 0 T f ( t ) e − r t d t where f ( t ) is the rate of continuous money flow at an interest rate r at time t .” Calculation: According to the given data f ( t ) = 300 , r = 0.08 and T = 10 . Substitute the respective values in the present value formula and simplify. P = ∫ 0 10 300 e − 0.08 t d t = 300 [ e − 0 (b) To determine To find: The accumulated amount of money flow at t = 10 if f ( t ) = 300 , r = 8 % and T = 10 .

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Chapter 8.3, Problem 2E

(a)

To determine

To find: The present value of the money for the time period of 10 years at 8% compounded interest where the rate of money flow is f(t)=300 .

(b)

To determine

To find: The accumulated amount of money flow at t = 10 if f(t)=300 , r=8% and T=10 .

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Chapter 8.3, Problem 1E

Chapter 8.3, Problem 3E

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