Question 1

A payment of $590 is now 93 days overdue. A second payment of $955 will be due and payable in 200 days. If money can earn an interest rate of 11%, what single amount, paid in 30 days, will be an equivalent replacement payment?
A) $1,507
B) $1,520
C) $1,545
D) $1,629
E) $1,783

Accepted Answer

The answer of A payment of $590 is now 93...

Question 2

A contract was signed eight months ago requiring the payment of $13,000 plus interest at 8% after one year. What two equal payments made today and four months from today are equivalent to the original contract? Assume that money is now worth 5%. Use four months from today as the focal date.
A) $7,020.00
B) $7,070.11
C) $6,446.28
D) $13,809.84
E) $7,078.02

Accepted Answer

The answer of A contract was signed eight months ago...

Quiz 6: Simple Interest

A payment of $590 is now 93 days overdue. A second payment of $955 will be due and payable in 200 days. If money can earn an interest rate of 11%, what single amount, paid in 30 days, will be an equivalent replacement payment?

A contract was signed eight months ago requiring the payment of $13,000 plus interest at 8% after one year. What two equal payments made today and four months from today are equivalent to the original contract? Assume that money is now worth 5%. Use four months from today as the focal date.