A cash flow is payable continuously at a rate of p, per annum at time t...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
A cash flow is payable continuously at a rate of p, per annum at time t provided a life who is aged x at time 0 is still alive. I is a random variable T which measures the complete future lifetime in years of a life aged .x. ii) Write down an expression, in terms of I, for the present value at time O of this cash flow using a constant force of interest of 8 per annum. Hence or otherwise, show that the expected present value at time 0 of this cash flow is equal to: exp(s), p.ds A cash flow is payable continuously at a rate of p, per annum at time t provided a life who is aged x at time 0 is still alive. I is a random variable T which measures the complete future lifetime in years of a life aged .x. ii) Write down an expression, in terms of I, for the present value at time O of this cash flow using a constant force of interest of 8 per annum. Hence or otherwise, show that the expected present value at time 0 of this cash flow is equal to: exp(s), p.ds A cash flow is payable continuously at a rate of p, per annum at time t provided a life who is aged x at time 0 is still alive. I is a random variable T which measures the complete future lifetime in years of a life aged .x. ii) Write down an expression, in terms of I, for the present value at time O of this cash flow using a constant force of interest of 8 per annum. Hence or otherwise, show that the expected present value at time 0 of this cash flow is equal to: exp(s), p.ds
Expert Answer:
Answer rating: 100% (QA)
1 The present value of the cash flow at time 0 is PV 0T pert dt pr1 erT Where T is a random ... View the full answer
Related Book For
Advanced Accounting
ISBN: 978-0077431808
10th edition
Authors: Joe Hoyle, Thomas Schaefer, Timothy Doupnik
Posted Date:
Students also viewed these finance questions
-
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
-
Start by reading both case studies and make notes of the business type, the situation the Entrepreneur/owner finds himself or herself in, and then thoroughly understand not only the depth, but the...
-
The Crazy Eddie fraud may appear smaller and gentler than the massive billion-dollar frauds exposed in recent times, such as Bernie Madoffs Ponzi scheme, frauds in the subprime mortgage market, the...
-
The yields of nine batches of a chemical process were measured and a sample mean of 2.843 and a sample standard deviation of 0.150 were obtained. The experimenter presented a confidence interval of...
-
A random variable X takes values between 0 and with a cumulative distribution function F(x) = A + Be-x for 0 x . (a) Find the values of A and B sketch the cumulative distribution function. (b)...
-
eral . . . Measurements are recorded with appropriate significant figures. Calculations are made carefully and correctly. Calculations are performed on values that are in mks units. o Convert to mks...
-
Notes to the financial statements present information on significant accounting policies, complex or special transactions, details of reported amounts, commitments, contingencies, segments, quarterly...
-
A distributor imports olive oil from Spain and Italy in large casks. He then mixes these oils in different proportions to create three grades of olive oil that are sold domestically in the United...
-
is commission fee paid to real estate agency included in Land, Land Improvements, Building, or Other Accounts when recording expenditures and receipts in a columnar form
-
Consider the two mutually exclusive projects in Table P5.49. Salvage values represent the net proceeds (after tax) from disposal of the assets if they are sold at the end of each year. Both projects...
-
Brian is designing a skate park and wants to build a curved ramp ( quarterpipe ) that leads skaters to a straight ramp. Brian plans that skaters will drop into the quarterpipe from rest and launch...
-
What do you think some pitfalls would be now that legislation allows transgender enlistment?
-
A Kite 50 feet above the ground moves horizontally at a speed of 8 ft/s. At what rate is the angle between the string and the ground decreasing when 150 feet of string is out? Preview My Answers...
-
The table below reports real GDP per capita for Germany and the United States for 2008 and 2018. Country Germany the United States Per capita real GDP 2008 Per capita real GDP 2018 $42,102 $49,319...
-
Gravel is being dumped from a conveyor belt at a rate of 20 cubic feet per minute. It forms a pile in the shape of a right circular cone whose base diameter and height are always the same. How fast...
-
Do you think the guidelines in the voluntary standard can be helpful?
-
A stone is thrown upward from the top of a building at an angle of 3 0 . 0 degree to the horizontal and with an initial speed of 2 4 . 0 m / s. The point of release is h = 4 4 . 0 m above the ground....
-
d. The characteristic equation of a control system is given by s+2s+8s+12s+20s+16+16=0. Determine the number of the roots of the equation which lie on the imaginary axis of s-plane
-
Creditors of Jones Corporation are considering petitioning the courts to force the company into Chapter 7 bankruptcy. The following information has been determined. Administrative expenses in...
-
What are temporarily restricted assets?
-
On June 30, 2011, Sampras Company reported the following account balances: On June 30, 2011, Pelham paid $300,000 cash for all assets and liabilities of Sampras, which will cease to exist as a...
-
At midyear, National Steel Fabricators, Inc. purchased a 35 percent ownership interest in Keystone Consolidated, Inc. for \($40\) million. At year-end, Keystone reported an operating loss of \($6\)...
-
ABC Inc. purchased all of the outstanding common shares of XYZ Inc. for \($100\) million cash. At the time of the acquisition, the fair value of XYZ was \($80\) million. Presented below are the...
-
Barranco, Inc., acquired all of the outstanding shares of Bemiller, Inc., by means of a share exchange valued at \($50\) million. At the time of the acquisition, the fair market value of Bemiller was...
Study smarter with the SolutionInn App