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If r per annum is the rate at which the principal A is compounded annually, then at the end of k years, the money due is
Q = A (1 + r)k
Suppose compounding is done continuously. i.e. at every instant the principal A is compounded at R per annum. Then,
Q = A eRk
The relationship between R and r is given by the following reasoning:
A (1 + r)k = A eRk
Example
If R = 5.25%, then ln(1 + r) = 5.25% or r = 5.39%
Suppose Rs.100 is being compounded annually at the rate of 10% per annum. What is the future value of Rs.100 at the end of the third year? What is the effective continuously compounded rate of interest? What is the future value of Rs.100 at the end of the third year, using this interest rate?
FV(Rs.100) = 100 x (1.10)3 = 133.1
If r = 0.1, then the continuously compounded rate of interest R is given by
R = ln(1 + 0.1) = 0.0953
FV(Rs.100) = 100 e0.0953 x 3 = 100 x 1.331 = 133.1
i dont understand it can you help
Determine if the acceleration of an object is given by a → = i → + 2 j → + 6tk → find out the object's velocity and position functions here given that the initial velocity is v
SQUARE 12 IN
i have to get 10 points in 10th class
the mean and standarddeviation of set a is -x ans s respectively.find the mean and standard deviation of set b
A reliability system consists of 15 independent components. The probability that a component works is 0.9 for each. The system works if at least 11 of the components work. Fi
5289441+4684612131
mean absolue deviation
Provided a homogeneous system of equations (2), we will have one of the two probabilities for the number of solutions. 1. Accurately one solution, the trivial solution 2.
hi i would like to ask you what is the answer for [-9]=[=5] grade 7
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