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Hey i know how to figure out annuity annually, semiannualy, quarterly, monthly, and daily. All with the formula
S=R [((1+i)^n -1)/i]
but me and my teacher were wondering if it would be possible to go past daily annuity and go to continuous annuity. So basically "annuity e" i.e the number e. Is this possible??
yes they are called continuously compounded annuities, and if i remember correctly the formula for the accumulated value is
where, and i is the annually compounded interest rate.
Ok thanks, so if my interest was 6%, 'i' would equal .06 or the yearly rate, correct? And S (subscript n) is what exactly?? Thanks
Sn is the accumulated value of the continuous annuity after n years.
i is 6% in your example, yes.