Contemporary Engineering Economics 6th Edition by Chan Park

Exercise 36

The Economist, a professional business journal, offers three types of subscriptions, payable in advance: three months auto-renewing at $45, one year at $160, and two years at $279. If money can earn 6% interest compounded monthly, which subscription should you take Assume that you plan to subscribe to the journal over the next two years. All subscription payments should be made at the beginning of each renewal cycle.