Calculus with Applications (10th Edition)

Published by Pearson
ISBN 10: 0321749006
ISBN 13: 978-0-32174-900-0

Chapter 8 - Further Techniques and Applications of Integration - Chapter Review - Review Exercises - Page 456: 55

Answer

$$ \left( f(x)=10000e^{-0.105t}, \quad T =10, \quad r= 10.5 \% \right) $$ If $f(t)=10000e^{-0.105t}$ is the rate of continuous money flow at an interest rate $r=0.105$ for $T=10$ years, then the final amount at an interest rate of 10.5% compounded continuously is $$ \begin{aligned} A &=e^{rT}\int_{0}^{T} f(t) e^{-rt}dt.\\ &=e^{0.105(10)} \int_{0}^{10} 10,000 e^{-0.105 t} d t \\ &\approx \$ 176,919.15 \end{aligned} $$ So, the accumulated amount of money flow at time $T=10$ is $\approx176,919.15.$

Work Step by Step

$$ \left( f(x)=10000e^{-0.105t}, \quad T =10, \quad r= 10.5 \% \right) $$ If $f(t)=10000e^{-0.105t}$ is the rate of continuous money flow at an interest rate $r=0.105$ for $T=10$ years, then the final amount at an interest rate of 10.5% compounded continuously is $$ \begin{aligned} A &=e^{rT}\int_{0}^{T} f(t) e^{-rt}dt.\\ &=e^{0.105(10)} \int_{0}^{10} 10,000 e^{-0.105 t} d t \\ &=\left.e^{1.05}\left(\frac{10,000 e^{-0.105 t}}{-0.105}\right)\right|_{0} ^{10} \\ &=\frac{10,000 e^{1.05}}{-0.105}\left(e^{-1.05}-1\right) \\ &\approx-272,157.25(-0.65006) \\ &\approx \$ 176,919.15 \end{aligned} $$ So, the accumulated amount of money flow at time $T=10$ is $\approx176,919.15.$
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