On February 1, John signed a contract to pay Janet $4,500 plus interest on April 2 and $5,500 plus interest on July 31. Both payments carried a 6.5% interest annually. Janet then sold both contracts to Fred on May 1 at a rate of 4.5% annually. Determine how much she received.
A) $10,145.20
B) $10,300.18
C) $10,451.07
D) $10,618.30
E) $11,863.54

Question

Quizplus · Accepted Answer

The correct answer is A because the present value of the payments on May 1 is $10,145.20.

On February 1, John Signed a Contract to Pay Janet