Question
A car dealer asks you to pay a payment of $7,000 for a car today and pay $5,000 at the end of year one, pay
A car dealer asks you to pay a payment of $7,000 for a car today and pay $5,000 at the end of year one, pay $4,000 at the end of year two and $3,000 at the end of year three. Assuming that the interest rate you can earn on a safe investment is 4%. What is the present value of your total payments for the car?
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International Financial Management
Authors: Cheol Eun, Bruce G. Resnick
8th edition
125971778X, 978-1259717789
