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Calculate the amount of $A for the following investments. (Note, they are unrelated) Each of the following three investment has a continuously compounded rate of
Calculate the amount of $A for the following investments. (Note, they are unrelated)
Each of the following three investment has a continuously compounded rate of return of 8% per annum.
- Invest $105 today and receive one payment of $A in exactly 37 months.
- Invest $10,000 today and receive $A per month indefinitely with the first such amount exactly one month from today.
- Invest $5,000 today and receive quarterly payment indefinitely. The payment grows at the rate of 1% per quarter. In other words, each payment is 1% greater than the previous. The first payment is $A and will be received exactly one quarter from today.
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