Daisy borrows money from a bank. She has the following options to repay the loan:
Option A: She makes 8 quarterly repayments of $2,500 starting three months after the borrowing date. Option B: She makes a single repayment of $X nine months after the borrowing date.

The two repayment options are equivalent at the interest rate of 3% p.a. compounded quarterly. 

Calculate the amount of $X Daisy needs to repay.

Answer rating: 100% (QA)

To solve this problem we need to use the concept of present value which is the current value of a fu... View the full answer