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Unformatted text preview: (A/(PA) , 1%, 11 ) A= (3000  A) * ([.01(1+.01)^11] / [(1+ .01) ^11 1] ) A = .09645(3000A) = 289.36  .09645 A 1.09645A = 289.36 A=263.90 The new buyer will pay 1000 + the 6th payment + the value of the remaining 5 payments: Payoff = 1000 + 263.90 + (P/A, 1%, 5) Payoff = 1000 +263.90 + 263.90 [(1.01^5  1)/ (.01 * 1.01^5)] Payoff = 1000 + 263.90 + 1280.82 = 2544.72 486 (a) P= (P/A , i, n) A(P/A, .75%, 36) 2800/ 31.447 = 89.04 (b) 36  9 = n P= A (P/A, ¾ % , 27) 24.360 * 89.04 = 2169.01 490 (a) P= (P/A , i, n) A(P/A, .75%, 24) 100/ 21.889 = 4.57 (b) 24 13 = 11 = n P= A (P/A, ¾ % , 11) 10.521 * 4.57 = 48.08 4116 A= $1000 r= .05 n= 5 years nominal interest rate r = 4 * 5% = 20% i = 1 + (.2/4) = 1.05^4 = 1.215 – 1 = .215 = effective interest rate is 21.5%...
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This note was uploaded on 04/27/2008 for the course EIN 4354 taught by Professor Tufecki during the Spring '08 term at University of Florida.
 Spring '08
 tufecki

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