Suppose the Annual Rate of Income from an Investment at Any

question 10

Multiple Choice

Suppose the annual rate of income from an investment at any time t is $K ( t ) = - 100 + 50 t$ . What is the formula for the present value of the income over the next 5 years at a 6% interest rate compounded continuously?

• A) \(\int _ { 0 } ^ { 5 } ( 50 t - 100 ) e ^ { 0.06 t } d t\)
• B) \(\int _ { 0 } ^ { 5 } ( 50 t - 100 ) e ^ { - 0.06 t } d t\)
• C) \(\int _ { 1 } ^ { 5 } ( 50 t - 100 ) e ^ { - 0.06 t } d t\)
• D) \(\int _ { 1 } ^ { 5 } 50 t ^ { - 0.06 t } d t\)
• E) none of these

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Definitions:

AASB 10

The Australian Accounting Standards Board regulation that sets out the requirements for preparing and presenting consolidated financial statements when an entity controls one or more other entities.

Consolidated Financial Statements

Financial statements that present the assets, liabilities, equity, income, expenses, and cash flows of a parent company and its subsidiaries as if the group were a single economic entity.

Intragroup Transactions

Transactions that occur between entities within the same group of companies, often leading to the need for elimination adjustments in consolidated financial statements.

Pre-acquisition Entries

Journal entries made to adjust the values of the acquiring company's assets and liabilities upon acquisition.