Question

37. An oil company plans to sell one oil well, and wants to use the present...

37. An oil company plans to sell one oil well, and wants to use the present value of this well over the next 10 years to establish its selling price. If the annual rate of flow is:

       F(t) = 600e^(-.2(t+5), in thousands of dollars per year, and if the interest rate is 10%, compounded continuously, FIND the Present Value.

Math   Precalculus   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Suppose that a printing firm considers its production as a continuous income stream. If the annual...
Suppose that a printing firm considers its production as a continuous income stream. If the annual rate of flow at time t is given by f(t) = 91.5e−0.8(t + 3) in thousands of dollars per year, and if money is worth 8% compounded continuously, find the present value and future value (in dollars) of the presses over the next 10 years. (Round your answers to the nearest dollar.) present value$ = future value$ =
Find the present value P of a continuous income flow of c(t) dollars per year using...
Find the present value P of a continuous income flow of c(t) dollars per year using P = t1 c(t)e−rt dt, 0 where t1 is the time in years and r is the annual interest rate compounded continuously. (Round your answer to the nearest dollar.) c(t) = 100,000 + 4000t, r = 5%, t1 = 8
39. Suppose a continuous income stream has an annual rate of flow given by: f(t) =...
39. Suppose a continuous income stream has an annual rate of flow given by: f(t) = 5000e^(-.01t). If the interest rate is 7%, compounded continuously, create the integral to solve:    a) The Total Income for the next 5 year b) Present Value for the next 5 year c) Future Value 5 years from now
Assuming a 10percent annual interest rate compounded continuously, what is the present value of an annuity...
Assuming a 10percent annual interest rate compounded continuously, what is the present value of an annuity that pays 400dollars a year (a) for the next 7 years(i.e, 400dollars 1 year later, 400 dollars 2 years later, 400dollars 3 years later,.. and 400 dollars 7years later) and (b)forever?
An investment produces a continuous income stream at the rate of ?(?) = 3000 − 50?...
An investment produces a continuous income stream at the rate of ?(?) = 3000 − 50? dollars per year at time ?. If the prevailing annual interest rate remains fixed during the next 6 years at 5% compounded continuously, what is the present value of the investment over the next 6 years?
A company wants to buy one of two machines: machine X or machine Y. The present...
A company wants to buy one of two machines: machine X or machine Y. The present worth of machine X over a life span of 3 years is $2,200 at an interest rate of 10% per year compounded annually whereas the present worth of machine Y over a life span of 6 years is $ 3,500 at the same interest rate. Based on the present worth criterion, which machine should the company pick? PLEASE HELP ASAP. dont use excel. solve...
The function F(X)= 700e^0.03x represents the rate of flow of money in dollars per year. Assume...
The function F(X)= 700e^0.03x represents the rate of flow of money in dollars per year. Assume a 10 year period at 5 percent compounded continuously. A. Find the present value B. the accumulated amount of money flow at t=10?
XKL Co. plans a new project that will generate $135018 of continuous cash flow each year...
XKL Co. plans a new project that will generate $135018 of continuous cash flow each year for 9 years and additionally $102141 at the end of the project. If the continuously compounded rate of interest is 3.06%, estimate the present value of the cash flows.( Use formula Step-by-Step, NOT excel)
An heiress receives an income stream from a will at a rate of f(t) = 40,000e0.023t...
An heiress receives an income stream from a will at a rate of f(t) = 40,000e0.023t dollars per year. She invests this income and earns 4.7% interest (compounded continuously). (Round your answers to two decimal places.) (a) What is the future value of the income after ten years? $   (b) Compute the present value of the income over a ten year period. $
Problem 17-10 Black-Scholes and Asset Value You own a lot in Key West, Florida, that is...
Problem 17-10 Black-Scholes and Asset Value You own a lot in Key West, Florida, that is currently unused. Similar lots have recently sold for $1,260,000. Over the past five years, the price of land in the area has increased 8 percent per year, with an annual standard deviation of 37 percent. A buyer has recently approached you and wants an option to buy the land in the next 12 months for $1,410,000. The risk-free rate of interest is 4 percent...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT