Recall That the Capital Value of an Asset Is Given $\int _ { 0 } ^ { \infty } \mathrm { K } ( \mathrm { t } ) \mathrm { e } ^ { - r \mathrm { t } } \mathrm { dt }$

question 115

Short Answer

Recall that the capital value of an asset is given by $\int _ { 0 } ^ { \infty } \mathrm { K } ( \mathrm { t } ) \mathrm { e } ^ { - r \mathrm { t } } \mathrm { dt }$ If the annual rate of earnings, K(t), of a certain machine is $3000 and if the interest rate is 12%, find the capital interest of the machine.
Enter just an integer representing dollars (no units).

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Definitions:

SML

Security Market Line, a graphical representation of the expected return of investments as a function of their risk, as measured by beta.

Vertical Intercept

The point where a graphed line crosses the vertical axis, often used in mathematical functions to determine a starting point.

Required Rate

The minimum return an investor expects to achieve on an investment, considering the risk level associated with the investment.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, used in statistics to quantify the variability or spread of a data set.