Mort M. answered • 07/23/20
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Jack L.
asked • 07/17/20Business Mathematics 114. A4P4Q1
Annette is considering two offers on her house in Rutland. The first offer is $400861.24 which includes 10% down, 45% to be paid in 1 year and the remainder to be paid in 2.5 years. The second offer is for $378334.52 with 50% down and the remainder to be repaid in 1 year. The rate of interest is 4.82% per year compounded monthly.
What is the value today of Annette's first offer?
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Mort M.
The 2.5 year line shows the 2.5 yr straight present value in the second column and then that value adjusted for the fact that the payment stream doesn't start for 12 months.07/23/20