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A movie stuntman receives an annual salary of $120,000, but becomes a quadriplegic after jumping from a c work again as a stuntman. Through a legal settlement with his insurance company, he is granted a continuou years. The stuntman invests the money at 7.5%, compounded continuously. a) Find the accumulated future value of the continuous income stream. b) Thinking that he might not live 20 years, the stuntman negotiates a flat sum payment from the insurance ce value of the continuous income stream. What is that amount?

A movie stuntman receives an annual salary of $120,000, but becomes a quadriplegic after jumping from a c work again as a stuntman. Through a legal settlement with his insurance company, he is granted a continuou years. The stuntman invests the money at 7.5%, compounded continuously. a) Find the accumulated future value of the continuous income stream. b) Thinking that he might not live 20 years, the stuntman negotiates a flat sum payment from the insurance ce value of the continuous income stream. What is that amount?

Intermediate Algebra
Intermediate Algebra
10th Edition
ISBN:9781285195728
Author:Jerome E. Kaufmann, Karen L. Schwitters
Publisher:Jerome E. Kaufmann, Karen L. Schwitters
Chapter11: Exponential And Logarithmic Functions
Section11.2: Applications Of Exponential Functions
Problem 27PS
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A movie stuntman receives an annual salary of $120,000, but becomes a quadriplegic after jumping from a cliff into water that is too shallow. He can never work again as a stuntman. Through a legal settlement with his insurance company, he is granted a continuous income stream of $120,000 per year for 20 years. The stuntman invests the money at 7.5%, compounded continuously. a) Find the accumulated future value of the continuous income stream. b) Thinking that he might not live 20 years, the stuntman negotiates a flat sum payment from the insurance company, which is the accumulated present value of the continuous income stream. What is that amount? a) The accumulated future value is (Round to the nearest ten dollars as needed.) b) The accumulated present value is (Round to the nearest ten dollars as needed.).
Transcribed Image Text:A movie stuntman receives an annual salary of $120,000, but becomes a quadriplegic after jumping from a cliff into water that is too shallow. He can never work again as a stuntman. Through a legal settlement with his insurance company, he is granted a continuous income stream of $120,000 per year for 20 years. The stuntman invests the money at 7.5%, compounded continuously. a) Find the accumulated future value of the continuous income stream. b) Thinking that he might not live 20 years, the stuntman negotiates a flat sum payment from the insurance company, which is the accumulated present value of the continuous income stream. What is that amount? a) The accumulated future value is (Round to the nearest ten dollars as needed.) b) The accumulated present value is (Round to the nearest ten dollars as needed.).
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