Michael had to make a payment of $2,750 in 10 months and $2,300 in 20 months, to a raw material supplier. What single payment in 4 months would settle both these payments? Assume a simple interest rate of 5.25% p.a. and use 4 months from now as the focal date. $0.00 Round to the nearest cent

Michael had to make a payment of $2,750 in 10 months and $2,300 in 20 months, to a raw material supplier. What single payment in 4 months would settle both these payments? Assume a simple interest rate of 5.25% p.a. and use 4 months from now as the focal date. $0.00 Round to the nearest cent

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter7: Using Consumer Loans

Section: Chapter Questions

Problem 6FPE

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Concept explainers

Mortgages

A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.

Mortgage

The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.

Question

Michael had to make a payment of $2,750 in 10 months and $2,300 in 20 months, to a
raw material supplier. What single payment in 4 months would settle both these
payments? Assume a simple interest rate of 5.25% p.a. and use 4 months from now as
the focal date.
$0.00
Round to the nearest cent

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