payments due in 3 months and 6 months. What is the value of the two equal payments if money is worth 6.20% and the focal date is today?

Corporate Fin Focused Approach
5th Edition
ISBN:9781285660516
Author:EHRHARDT
Publisher:EHRHARDT
Chapter4: Time Value Of Money
Section4.17: Amortized Loans
Problem 1ST
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Katie takes out a loan today in the amount of
$1776. It is to be settled (paid off) by two equal
payments due in 3 months and 6 months. What
is the value of the two equal payments if money
is worth 6.20% and the focal date is today?
Transcribed Image Text:Katie takes out a loan today in the amount of $1776. It is to be settled (paid off) by two equal payments due in 3 months and 6 months. What is the value of the two equal payments if money is worth 6.20% and the focal date is today?
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