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Assume the force of interest function is as follows: t={0.04, 0t6, 0.05, 6t12) where time t is measured in years. (a) An annuity pays continuously
Assume the force of interest function is as follows:
t={0.04, 0t6,
0.05, 6t12)
where time t is measured in years. (a) An annuity pays continuously at a rate of 150 + 10t per year for 5 years. Find the present value of this annuity. (b) An annuity pays continuously at a rate of 150 + 10t per year for 10 years. Find the present value of this annuity.
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