An oil company discovered an oil reserve of 100 million barrels.?

An oil company discovered an oil reserve of 100 million barrels.?


For time t %26gt; 0, in years, the company鈥檚 extraction plan is a linear declining function of time as follows:


,


where q(t) is the rate of extraction of oil in millions of barrels per year at time t and b = 0.1 and a = 10.





(a) If it takes 10.6 years to exhaust the reserve and the oil price is a constant $20 per barrel, the extraction cost per barrel is a constant $10, and the market interest rate is 10% per year, compounded continuously. What is the present value of the company鈥檚 profit?An oil company discovered an oil reserve of 100 million barrels.?
The function q(a,b,t) for the extraction plan has disappeared from your question, so nobody can answer it for you.