Varying payments - Discounting Factor

Discussion in 'CT1' started by bpatel28, Jan 16, 2015.

  1. bpatel28

    bpatel28 Member

    The force of interest varies over time and is given by :

    =0.003t + 0.03 for0<t<5
    =0.045 for t > 5

    Derive a formula for v(t).

    I have managed part a).. I don't seem to get the correct answer for part b). I'm currently evaluating the integral from 5 to t, of 0.045 with respect to t.
     
  2. Noely

    Noely Member

    The formula that you should get for v(t) would be for the range of 0<t<5 and then from t>5. So you need to resolve this need to determine the v(t) for 0<t<5 which you have done.

    Then you must look at v(t) for t>5, which includes the time period between 0 to 5. So basically the function you are looking at getting not only include the t>5 component but must also include the v(t) for 0<t<5.

    When you are working on this problem what formula are you getting for v(t) t>5?
     

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