An investor is presented with a choice of two investments: an established clothing store and a new

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An investor is presented with a choice of two investments: an established clothing store and a new computer store. Each choice requires the same initial investment and each produces a continuous income stream of 4%, compounded continuously. The rate of flow of income from the clothing store is f(t) = 12,000, and the rate of flow of income from the computer store is expected to be g(t) = 10,000e0.05t. Compare the future values of these investments to determine which is the better choice over the next 5 years.

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College Mathematics For Business Economics, Life Sciences, And Social Sciences

ISBN: 978-0134674148

14th Edition

Authors: Raymond Barnett, Michael Ziegler, Karl Byleen, Christopher Stocker

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