For unlimited access to Study Guides, a Grade+ subscription is required.
2. A debt of $1000 due 4 years from now and $1500 due 6 years from now, is instead to be paid off by a single payment 5 years from now. How much is the payment if an interest rate of 8.4% compounded monthly is assumed? A) $2466.86 B) $2500.00 C) $2000.00 D ) $2467.76 E) none of these
A person has an old debt of $3000 due to be paid in 3 years. He negotiates a new payment plan to pay this debt off by making three payments of x dollars each, starting with one payment now, another in 3 years and a final payment in 4 years. If interest is at an annual rate of 6% compounded monthly, find x = ?
2. A total debt of $9,000 due four years from now and $6,000 due 68 months from now is to be repaid by three payments as follows: 12 months (i) a first payment at the end of the first year; (ii) a second payment at the end of 30 months from now and is 60% more than the first payment; (iii) a third payment that is 10% less than the second payment and is made five years from now. GO months Interest is 2.4% APR compounding monthly. Find the amount of the three payments. Carry at least five decimals in all of your calculations. Round your final answers up to the nearest dollar. A complete money-time diagram and equation of value are required for full points. (12 points)