A client would like you to explain some options he has regarding discounting of a 6 percent, 60-day, $ 2,400 note receivable. He wants to know what he will receive in proceeds and what his interest income (or expense) will be if he discounts the note
(a) After 10 days with a discount rate of 7 percent,
(b) After 50 days with a 7.5 percent discount rate,
(c) After 5 days with a discount rate of 6.5 percent.
Make the calculations for the client and explain the different outcomes to him.