Question 2 We consider compound interest with a nominal annual rate r compounded n times per year. The value V(t) of an initial investment Vo after t years is given by nt V = Vo (1 + )" . n (a) For...

Extracted text: Question 2 We consider compound interest with a nominal annual rate r compounded n times per year. The value V(t) of an initial investment Vo after t years is given by nt V = Vo (1 + )" . n (a) For fixed Vo,r, and t, the limit lim V is indeterminate. What type of indeterminate form is it? n→∞ (b) Continuously compounded interest is obtained by compounding more and more frequently. Find lim V.