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Unformatted text preview: if i = 3% and j = 4.5%. 3. A continuously paying level annuity pays $50 each year for ten years. The force of interest at time t is t = 2/(1 + 2t). a) Find the present value of this annuity. b) If instead of $50 per year, the rate of payment at time t is 1 + 4t + 4t 2 , find the present value of this annuity. 4. Consider a continuously increasing annuity for n periods in which payments are being made continuously at rate t at time t. Effective interest rate per period is i. Find an expression for the present value of this annuity, and a logical notation for it....
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- Fall '09