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4. Consider Investment Account A which has a variable force of interest, 84 in years and t = 0 corresponds to today. 1 where t
4. Consider Investment Account A which has a variable force of interest, 84 in years and t = 0 corresponds to today. 1 where t is measured 6+t (a) (5 pts) Find the accumulation function for this investment. (b) (5 pts) How much would one need to invest in such an account 4 years from now in order to have $6,000 9 years from now? (C) (8 pts) Suppose you are given the opportunity to invest in Account A (above) or Account B, which earns 9% annual effective interest, and you can switch from one account to the other at any time. Describe a strategy to maximize your investment (i.e. where should you put your money to start, and when, if ever, should you switch it to the other account)? 4. Consider Investment Account A which has a variable force of interest, 84 in years and t = 0 corresponds to today. 1 where t is measured 6+t (a) (5 pts) Find the accumulation function for this investment. (b) (5 pts) How much would one need to invest in such an account 4 years from now in order to have $6,000 9 years from now? (C) (8 pts) Suppose you are given the opportunity to invest in Account A (above) or Account B, which earns 9% annual effective interest, and you can switch from one account to the other at any time. Describe a strategy to maximize your investment (i.e. where should you put your money to start, and when, if ever, should you switch it to the other account)
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