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RP- EP 4. Derive the formula In adRP(l+r)-EP In(1 r) where RP is the regular...

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RP- EP 4. Derive the formula In adRP(l+r)-EP In(1 r) where RP is the regular pension, EP is the early pension (the amount that a person can receive in case of early retirement), r is the annual rate of adjustment of pension payments (assumed to be constant) and t, is the time between in-time retirement and early retirement. Use the formula to answer the following question. Mike has applied for early retirement at age 62. In this case he would get a 20,000 pension. The regular retirement age is 65 The regular pension is 23,000. Suppose that the company he worked for adjusts pension payments on an annual basis at the rate of 3.5% a year. How old would be Mike when the two pensions equal each other

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