Mary's lawyer gave her the following two options to settle her invoice. 1)$1900 in 1 month and the balance of $2,800 in 5 months. 2)Two equal payments , one in 21 days and the other in 10 months. If money earned 5.30% p.a. , what was the value of the equal payments in option 2) such that it is equivalent to the payments in option 1).Use now as the focal date for this question.

Mary's lawyer gave her the following two options to settle her invoice. 1)$1900 in 1 month and the balance of $2,800 in 5 months. 2)Two equal payments , one in 21 days and the other in 10 months. If money earned 5.30% p.a. , what was the value of the equal payments in option 2) such that it is equivalent to the payments in option 1).Use now as the focal date for this question.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 8P

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