Assuming continuous compounding what is the nominal annual, Business Economics

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Assuming continuous compounding what is the nominal annual

Bart wishes to tour the country with his friends. To do this, he is saving money for a bus.

(a) How much money must Bart deposit in a savings account paying 8% nominal annual interest, compounded continuously, in order to have $8000 in 41/2 years?

(b) A friend offers to repay Bart $8000 in 41/2 years if Bart gives him $5000 now. Assuming continuous compounding, what is the nominal annual interest rate of this offer?

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Business Economics: Assuming continuous compounding what is the nominal annual

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