Sam Has a Financial Obligation That Requires Him to Pay

Multiple Choice

Sam has a financial obligation that requires him to pay $1,700 in one year; $1,300 in 2 ½ years and a final payment of $2,000 in 3 years. If Sam wishes to pay off all his obligations in 18 months, given an interest rate of 6.7% compounded quarterly. Using the financial functions on the calculator, determine the lump sum payment needed to fulfill his obligations in 18 months.

A) $4,784.14
B) $4,884.26
C) $4,916.54
D) $5,219.23
E) $5,424.86