Suppose that a company needs new equipment, and that the machinery in question earns the company revenue at a continuous rate of 64000t+38000 dollars per year during the first six months of operation, and at the continuous rate of $70000 per year after the first six months. The cost of the machine is $175000. The interest rate is 6.25% per year, compounded continuously.

Question

Suppose that a company needs new equipment, and that the machinery in question earns the company revenue at a continuous rate of 64000t+38000 dollars per year during the first six months of operation, and at the continuous rate of $70000 per year after the first six months. The cost of the machine is $175000. The interest rate is 6.25% per year, compounded continuously.

a) Find the present value of the revenue earned by the machine during the first year of operation. Round your answer to the nearest cent.
Value: $59940.05598851

b) Determine how long it will take for the machine to pay for itself; that is, how long until the present value of the revenue is equal to the cost of the machine. Round your answer to the nearest hundredth.
Years:

I got part a right. I just need help with part b.

Answer 1

so, they gave you the formula for the cost, right?

so just do what they say -- set them equal and solve for the time.
Still stuck? how?