Two Payments of $10 000 Each Must Be Made One

question 54

Multiple Choice

Two payments of $10 000 each must be made one year and four years from now. If money can earn 9% compounded monthly, what single payment two years from now would be equivalent to the two scheduled payments?

• A) $10 938
• B) $8358
• C) $11 964
• D) $22 902
• E) $19 296

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Definitions:

Cooperative Basis

A foundational principle for organizations or enterprises that are owned and run jointly by their members, who share the profits or benefits.

Private Property

The legal right to own, use, and manage property, which is protected by law from unauthorized use by others.

Robert Owen

A 19th-century Welsh social reformer and one of the founders of utopian socialism and the cooperative movement.

Model Factory Village

A planned community designed during the Industrial Revolution to house factory workers, often including amenities and facilities intended to improve workers' living conditions and productivity.