(a) Calculate the present value of a continuous revenue stream of f(t) = 4000 + 1000t per year if the interest rate is 4% and the money is paid over 10 years.
(b) The present value of a continuous revenue stream of f(t) at an interest rate of 4% for 8 years is 20000 e. Suppose f(t) is constant. Calculate f(t) to two decimal places.
(c) Find the present value of a perpetual revenue stream having flow rate R(t) = (t + 1)-1 *e -0.03t, which is subject to a fixed interest rate of 3%. What goes wrong in this situation?