Peter and Reesa can book their Horizon Holiday package at the early-booking price of $3900, or wait

Question:

Peter and Reesa can book their Horizon Holiday package at the early-booking price of $3900, or wait four months and pay the full price of $3995.
a. Which option should they select if money can earn a 5.25% rate of return?
b. At what interest rate would they be in different between the two prices?

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