You Owe the Bank $2000 in 9 Months

question 59

Multiple Choice

You owe the bank $2000 in 9 months.Instead you negotiate with the bank to pay $1200 in 3 months and $X in 7 months to fully pay off the loan.Using a simple discount rate of d = 9% and a focal date of 7 months from now,what is X?

• A)$732.89
• B)$734.44
• C)$866.46
• D)$877.08

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