Miquel Was Supposed to Make Three Payments of $2,000 Each-The

question 110

Short Answer

Miquel was supposed to make three payments of $2,000 each-the first one year ago, the second one year from now, and the third three years from now. He missed the first payment and proposes to pay $3,000 today and a second amount in two years. If money can earn 4.5% compounded semi-annually, what must the second payment be to make the proposed payments equivalent to the scheduled payments?

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Definitions:

Rule of Law

The principle that all individuals, institutions, and entities are accountable to laws that are publicly promulgated, equally enforced, and independently adjudicated.

Governmental Power

The extent of authority and control that a government holds to regulate, manage, and influence societal and economic activities.

Theocratic Law

A system of law that relies on religious doctrine and belief.

Adjudicated

The process by which a judge or a legally appointed arbiter receives and weighs evidence to make a legal decision or judgment.