Asked by
Jessica Zuniga
on Dec 15, 2024
Verified
Two payments of $1,000 now and $3,000 in 6 months are to be replaced by $2,500 in 4 months and another in 9 months. If the rate of interest is 6.3% annually, determine the value of the final payment in 9 months if the focal point is in 9 months.
A) $1,532.67
B) $1,528.875
C) $1,502.65
D) $1,498.13
E) $1,486.86
Rate of Interest
The percentage at which interest is paid by a borrower for the use of money they borrow from a lender.
Final Payment
The last payment made to settle a financial obligation, completing the payment schedule.
- Calculate the contemporary and prospective financial values of individual payments and sequences of payments considering varied interest rates and time intervals.
- Examine the monetary ramifications of transitioning from multiple payments to a single payment and vice versa.
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Learning Objectives
- Calculate the contemporary and prospective financial values of individual payments and sequences of payments considering varied interest rates and time intervals.
- Examine the monetary ramifications of transitioning from multiple payments to a single payment and vice versa.