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1. Sally wants to buy a stereo system. She is given two payment options: Option 1 Option 2 $0 down $82.56 down $432 in 1

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1. Sally wants to buy a stereo system. She is given two payment options: Option 1 Option 2 $0 down $82.56 down $432 in 1 year $250 in one year $300 in 2 years $400 in two years Determine the range of interest rates for which the present value of option 1 is less than the present value of option 2

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