T-Mobile LTE 21%)LD-+ 10:41 PM ilearn.laccd.edu Instructure Inc. View GET On the

Question

T-Mobile LTE 21%)LD-+ 10:41 PM ilearn.laccd.edu Instructure Inc. View GET On the App Store G.031_17941FA17C> Quizzes > Chapter XVIl Quiz Chapter XVIII Quiz Started: Oct 31 at 11:15am D Quiz Instructions Multiple Choice Questions. Select the correct answers only to the following questions after reading and studying chapter XVIlI of your textbook. There is ne time limit. Calendar Question 5 2 pts Inbox 5. If a $1200 simple discount not is due to mature in nine months, and if current interest rate present value of the note is Help s are 7% compounded quarterly, the a. $1082.32 b. $1139.14 c. $1137 d. $1184.25 ns lab- k- Next

Explanation / Answer

F=P*((1+i)^N)

F=Future Value

P=Present value

i=Interest Rate per period

N=number of periods

In this case,

N=number of periods =number of quarters=9months/3=3 quarters

N=3

Annual interest rate=7% compounded quarterly

Annual interest=7%=0.07

Interest per period(quarter)=0.07/4=0.0175

i=0.0175

F=$1200

1200=P*((1+0.0175)^3)

1200=P*1.053424

P=1200/1.053424= $ 1,139.14

Answer :b. $ 1,139.14

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