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A Person Has the Option of Satisfying a Debt by Either

Question 55

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A person has the option of satisfying a debt by either paying $5000 now and $5000 in two years,or by paying $3000 now,$3000 a year from now,and a final payment of x dollars two years from now.Determine an equation of value that corresponds to the value of all payments at the end of two years.It is not necessary to solve the equation.Assume that interest is at the rate of 10% compounded semiannually.

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5000(1.0 blured image_TB6578_11 ...

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