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4) The annual effective interest rate is 10% compounded monthly. Deal A: You give me $4000 today and I pay you back $2000 in 1

4) The annual effective interest rate is 10% compounded monthly.

Deal A: You give me $4000 today and I pay you back $2000 in 1 year, and $4000 in 2 years.

Deal B: I give you $2000 today and another $4000 in 1 year and you pay me $X in 2 years.

What does $X have to be for you to be indifferent between these two deals?

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