Present value 500,000e-0.051 dt.

Algebra & Trigonometry with Analytic Geometry
13th Edition
ISBN:9781133382119
Author:Swokowski
Publisher:Swokowski
Chapter5: Inverse, Exponential, And Logarithmic Functions
Section5.6: Exponential And Logarithmic Equations
Problem 40E
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The board of directors of a corporation is calculating the price to pay for a business that is forecast to yield a continuous flow of profit of $500,000 per year. The money will earn a nominal rate of 5% per year compounded continuously. The present value of the business for t0 years is Present value attached. (a) Find the present value of the business for 20 years. (b) Find the present value of the business in perpetuity (forever).

Present value
500,000e-0.051 dt.
Transcribed Image Text:Present value 500,000e-0.051 dt.
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