The company issues a note to a customer to borrow cash for five years, and will pay
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Question:
The company issues a note to a customer to borrow cash for five years, and will pay $500,000 to the customer at the end of the five-year period but not pay any interest. If the annual market interest rate is 7%,
calculate the present value of the note (compounded annually and rounded to the nearest dollar).
Based on the above answer, if the company will pay $500,000 at the end of the five-year period, and interest $30,000 at the beginning of each of the five years,
Required:
calculate the present value of the note (rounded to the nearest dollar)
Related Book For
Engineering Economy
ISBN: 978-0132554909
15th edition
Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
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