Quiz 2 B - & d ) & 1 = (1...

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ACTSC 231 Solutions for Quiz 2 Blue 1. Invest $1 from time 3 to time 4: 1 e R 4 3 t dt = e R 4 3 : 03 1+ : 01 t dt = e 3 ln(1+ : 01 t ) j 4 3 = e ln ( 1 : 04 1 : 03 ) 3 = 1 : 04 1 : 03 ± 3 this is the bal. at the end of the 4th year Interest earned during the 4th year: i 4 = 1 : 04 1 : 03 ± 3 1 = 2 : 94% 2. The 1 year accumulation factors are: a. 1 + i = 1 : 21 b. ² 1 + i (2) 2 ³ 2 = 1 + : 20 2 ± 2 = 1 : 21 c. (1
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Unformatted text preview: & d ) & 1 = (1 & : 175) & 1 = 1 : 212 1 d. e : 19 = 1 : 209 2 From the borrows persective the larger accumulation factors are preferred. & = : 19 is the worest i = 21% and i (2) = 20% are equivalent d = 17 : 5% is the best 1...
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This note was uploaded on 02/07/2010 for the course ACTSC 231 taught by Professor Chisholm during the Spring '09 term at Waterloo.

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