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Home Q & A Board Science-Related Homework Help Mathematics
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ikrabbe ikrabbe
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6 years ago
A six-year, $1650.00 note bearing interest at 9.51% compounded annually was discounted at 11.2% compounded semi-annually yielding proceeds of $1916.75. How many months before the due date was the discount date?
Textbook 
Contemporary Business Mathematics with Canadian Applications

Contemporary Business Mathematics with Canadian Applications


Edition: 11th
Authors:
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#1
6 years ago
PV = 1650, i = 0.0951, n = 6
Maturity Value = 1650.00(1.0951)6 = 1650.00(1.7247362) = 2845.81
Discount: FV = 2845.81, PV = 1916.75, i = 0.112 ÷ 2 = 0.056
n =   =   =   = 7.253253
The discount date is 7.253253 × 6 = 43.52 months before the due date.
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