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Luis's lawyer gave her the following two options to settle her invoice: (a) $1,900.00 in 1...

Luis's lawyer gave her the following two options to settle her invoice:

(a) $1,900.00 in 1 month and the balance of $2,800.00 in 5 months.

(b) 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 (b) such that it is equivalent to the payments in Option (a)? Use now as the focal date for this question.

Solutions

Expert Solution

Value of Equal payments = $ 2,370.01

Formulae

Formulae as above

jeff jeffy answered 2 years ago
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