Katharinas husband, Jonathan, invested $1,000 at a continuously compounded rate of 10 percent for two years. The

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Katharina’s husband, Jonathan, invested $1,000 at a continuously compounded rate of 10 percent for two years. The appropriate formula here is:$1,000  e10x2 = $1,000  e20 = $1,221.40

Using the portion of the table of continuously compounded rates shown in the previous example, we find the value to be 1.2214.

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Corporate Finance

ISBN: 9781265533199

13th International Edition

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe

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