Jeremy Has a Number of Outstanding Credit Cards Debts

question 45

Multiple Choice

Jeremy has a number of outstanding credit cards debts. He seeks help from BDO to consolidate his debts and make it easy for him to make the debt payments. BDO offers him two alternatives. In the first alternative, the debt can be settled by making a payment of $30 000 now and a final payment of $42 000 in 3 years. Alternatively, the obligation can be settled by payments of $8400 at the end of every three months for three years. Which alternative is preferred if the interest is 8.5% compounded quarterly.

• A) Alternative 1
• B) Alternative 2
• C) Neither Alternative
• D) Don't take offer from the BDO
• E) Alternative 1 or Alternative 2, as both are essentially same

---

Definitions:

Private Information

Data or details that are personal or sensitive in nature and not meant to be shared with or accessible by the public.

Team Opportunity

A chance or prospect for a group to work together towards a common goal or project.

Tuckman Phase

A model outlining the stages of team development, including forming, storming, norming, performing, and adjourning.

Team Development

Team development involves the process of improving collective performance by enhancing the skills, collaboration, and structures within a group working towards a common goal.