A 58-year-old couple are considering opening a business of their own. They will either purchase an established Gift and Card Shoppe or open a new Video Rental Palace. The Gift Shoppe has a continuous income stream with an annual rate of flow at time t given by (dollars per year) and the Video Palace has a continuous income stream with a projected annual rate of flow at time t given by (dollars per year). The initial investment is the same for both businesses, and money is worth 10% compounded continuously. Find the present value of the Video Palace over the next 8 years (until the couple reach age 66). Round your answer to the nearest dollar.
A)$222,961
B)$220,268
C)$202,618
D)$237,342
E)$181,863

Question

A 58-year-old couple are considering opening a business of their own. They will either purchase an established Gift and Card Shoppe or open a new Video Rental Palace. The Gift Shoppe has a continuous income stream with an annual rate of flow at time t given by  (dollars per year) and the Video Palace has a continuous income stream with a projected annual rate of flow at time t given by  (dollars per year). The initial investment is the same for both businesses, and money is worth 10% compounded continuously. Find the present value of the Video Palace over the next 8 years (until the couple reach age 66). Round your answer to the nearest dollar. ​
A)$222,961 
B)$220,268 
C)$202,618 
D)$237,342 
E)$181,863

Quizplus · Accepted Answer

The Answer of A 58-year-old couple are considering opening a business of their own. They will either purchase an established Gift and Card Shoppe or open a new Video Rental Palace. The Gift Shoppe has a continuous income stream with an annual rate of flow at time t given by  (dollars per year) and the Video Palace has a continuous income stream with a projected annual rate of flow at time t given by  (dollars per year). The initial investment is the same for both businesses, and money is worth 10% compounded continuously. Find the present value of the Video Palace over the next 8 years (until the couple reach age 66). Round your answer to the nearest dollar. ​
A)$222,961 
B)$220,268 
C)$202,618 
D)$237,342 
E)$181,863

A 58-Year-Old Couple Are Considering Opening a Business of Their