1). An $800 note that bears interest at 9% matures in 180 days. What is the present value of the note after three-quarters of the term if money is worth 10%?rn

2). A retailer who found he could not pay a bill for $1,200 on the day it was due signed a 60-day note with interest at 91%. Twenty-four days later he found he could settle the debt and paid the present value of the note at the market rate of 10%. 

a). How much did the extension of credit cost him? 

b). If he had paid interest according to the terms of the note for 24 days, how much would the extension of credit have cost him?

Answer rating: 100% (QA)

ANSWERS 1 800 x 101075 86751 2a 1200 x 10091024 137297 2b 1200 x ... View the full answer