math
posted by Amanda on .
Find the present value of $53705.69 due in 5 yr at an interest rate of 8%/year compounded continuously.
$ ?

dx/dt = .08 x
dx/x = .08 dt
ln x = .08 t + C
x = e^(.08 t + C) = c e^.08 t
when t = 0, x =Xo
when t = 5 , x = 53705.69
53705.69 = Xo e^.40
Xo = 53705.69/e^.4 = 36,000