Continuous Payments
November 10th, 2010
I had the following question from a student:
I am having some trouble understanding this question. I know how they solve the question but I am trying to solve it using the accumulation factor. In the solutions, they solve for the accumulation factor by taking an integral from n-10 of the force of interest. Using the trick you showed in your seminar, I found a(t) to be 1+t/8. Could you explain how the accumulation factor is used when it comes to these types of questions. The whole idea of continuous payments seems to bother me.