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Unformatted text preview: supported by complete workings. [5 Marks] Option A Option B b) What is the effective rate of interest for Option B? [2 Marks] ______________________________ 2 2. Hank's personal goal is to have saved $2.5 million dollars by the end of the next twentyfive years. His bank manager has offered him 4% compounded semiannually. What's the allimportant present value which will allow Hank to meet his personal goal? [2 Marks] _____________________________ 3. The following matrix is presented with the states in the following order: 1, 2, 3, 4 & 5 .7 .2 .1 1 1 1 .3 .2 .4 .1 a) Reorganise it so that the absorbing states are listed first. [3 Marks] b) Give I for the Absorbing States [1 Mark] c) Give (IS) [All workings must be shown for full credit.] [2 Marks] d) Give the inverse of (I S). [All workings must be shown for full credit.] [3 Marks]...
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This note was uploaded on 01/15/2011 for the course MATH 151 taught by Professor Barone during the Spring '09 term at University of Victoria.
 Spring '09
 Barone
 Math

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