Jack sells his lawn-mowing business for $50,000 but the buyer wants to pay for it in two cash payments: $25,000 in two months from today and the balance in 1 year from today. How much will Jack need to receive as the final payment (in 12 months) if the interest rate he charges is 6% per annum compounding monthly? A.$25,584.91 B.$25,248.14 C.$27,446.42 D.$26,805.39
Jack sells his lawn-mowing business for $50,000 but the buyer wants to pay for it in two cash payments: $25,000 in two months from today and the balance in 1 year from today. How much will Jack need to receive as the final payment (in 12 months) if the interest rate he charges is 6% per annum compounding monthly? A.$25,584.91 B.$25,248.14 C.$27,446.42 D.$26,805.39
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 19PROB
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Jack sells his lawn-mowing business for $50,000 but the buyer wants to pay for it in two cash payments: $25,000 in two months from today and the balance in 1 year from today. How much will Jack need to receive as the final payment (in 12 months) if the interest rate he charges is 6% per annum compounding monthly?
A.$25,584.91
B.$25,248.14
C.$27,446.42
D.$26,805.39
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