Establish trust fund to pay researcher salary for T years

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Reference no: EM131874044

A benefactor wishes to establish a trust fund to pay a researcher’s salary for T years. The salary is to start at S0 dollars per year and increase at a fractional rate of a per year. Find the amount of money P0 that the benefactor must deposit in a trust fund paying interest at a rate r per year. Assume that the researcher’s salary is paid continuously, the interest is compounded continuously, and the salary increases are granted continuously.

Reference no: EM131874044

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