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A property is assumed to have value V(t) = 120 evt/5 after t years. We use continuous compounding and discount rate r = 4% when
A property is assumed to have value V(t) = 120 evt/5 after t years. We use continuous compounding and discount rate r = 4% when we compute the present value of the selling price. a. We wish to sell the property when the present value of the selling price is maximal. When is it optimal to sell the property? b. Let T be the number of years it takes for the value of the property to double. Find T, and show that it takes another 37 years until the value is doubled again
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