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Two Payments of $5,000 Are to Be Received Four and Eight

Question 142

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Two payments of $5,000 are to be received four and eight months from now.
a) What is the combined equivalent value of the two payments today if money can earn 6%?
b) If the rate of interest money can earn is 4%, what is the payments' combined equivalent value today?

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a) $9,709....

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