A contract between two parties (company X & Y) was created such that in return for services rendered, company X would provide payments of $15,000 in 8 months, $35,000 in 16 months, and $40,000 in 24 months. However, a clause was inserted in the contract that allowed company X to pay two equal lump sum payments in months 30 and 36. If interest on the contract is 6.5% compounded annually, determine the value of the lump sum payments that should be written in the contract. When entering your answer, round your values to two decimal places, and use a $ symbol as well as the correct comma separator. For example $12,345.67
A contract between two parties (company X & Y) was created such that in return for services rendered, company X would provide payments of $15,000 in 8 months, $35,000 in 16 months, and $40,000 in 24 months. However, a clause was inserted in the contract that allowed company X to pay two equal lump sum payments in months 30 and 36. If interest on the contract is 6.5% compounded annually, determine the value of the lump sum payments that should be written in the contract. When entering your answer, round your values to two decimal places, and use a $ symbol as well as the correct comma separator. For example $12,345.67
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:A contract between two parties (company X & Y) was
created such that in return for services rendered,
company X would provide payments of $15,000 in 8
months, $35,000 in 16 months, and $40,000 in 24
months.
However, a clause was inserted in the contract that
allowed company X to pay two equal lump sum
payments in months 30 and 36.
If interest on the contract is 6.5% compounded
annually, determine the value of the lump sum
payments that should be written in the contract.
When entering your answer, round your values to two
decimal places, and use a $ symbol as well as the
correct comma separator. For example $12,345.67
Answer:
Answer
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