Present Value of a Continuous Stream of Income

question 41

Multiple Choice

Present Value of a Continuous Stream of Income.An electronics company generates a continuous stream of 4t income of million dollars per year,where t is the number of years that the company has been in operation.Find the present value of this stream of income over the first 15 years at a continuous interest rate of 10%.Round answer to one decimal place. ​

• A) $407.2 million
• B) $176.9 million
• C) $497.3 million
• D) $1296.3 million
• E) $324.1 million

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Definitions:

Legal Idiom

A set phrase or expression that has acquired a specialized meaning in the legal profession, often different from its literal meaning.

Possession

The state or fact of owning or holding something, legally or physically.

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A time of economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters.

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The total amount of money spent by consumers on goods and services within an economy, a crucial factor for economic analysis.