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Financial Maths

faimquestion2.png

The answers are a=0.077206 , b=0.0057685

What i do is use delta t as (a-b)e^t/5

Then do 2 equations -
140=100exp integral of (a-b)(e^t/5)
I take the a-b out and integrate it with limits 0 and 5

I do it similarly for the other one - 180=140exp.... with limits 5 and 10

I arrive to a-b=ln1.4/(e/5)-(1/5) and another a-b=.....

Therefore the two equations have both a-b which makes it impossible to work out constant a and b. Is there any other way to do it?
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Avatar for shamika
shamika
16
Original post by neverloggedin
faimquestion2.png

The answers are a=0.077206 , b=0.0057685

What i do is use delta t as (a-b)e^t/5

Then do 2 equations -
140=100exp integral of (a-b)(e^t/5)
I take the a-b out and integrate it with limits 0 and 5

I do it similarly for the other one - 180=140exp.... with limits 5 and 10

I arrive to a-b=ln1.4/(e/5)-(1/5) and another a-b=.....

Therefore the two equations have both a-b which makes it impossible to work out constant a and b. Is there any other way to do it?


The force isn't (a-b)(e^t/5), its a - (be^t/5). The method you used should get the right result. Be careful with the limits of your integrals though (once again, read the question properly!)
(edited 11 years ago)
Reply 2
Avatar for neverloggedin
neverloggedin
OP
1
Original post by shamika
The force isn't (a-b)(e^t/5), its a - (be^t/5). The method you used should get the right result. Be careful with the limits of your integrals though (once again, read the question properly!)


Oh wow damn my silly mistakes ! Thanks a lot!

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