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  3. company c showed a profit of $1.3 million last yea

Company C showed a profit of $1.3 million last year. The CEO of the company expects...

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Basic Math

Company C showed a profit of $1.3 million last year. The CEO ofthe company expects the profit to decrease by 2% each year over thenext five years and the profits will be continuously invested in anaccount bearing a 4.75% APR compounded continuously.

(a) Write the flow rate, R, of the income stream. (Lett represent the number of years after the company showed aprofit of $1.3 million.)
R(t) =  

1.3·(95100​)t

   million dollars per year

(b) Calculate the 5-year future value. (Round your answer to threedecimal places.)
$  million

(c) Calculate the 5-year present value. (Round your answer to threedecimal places.)
$  million

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