1. Debts of $500 due 27 months ago from today and $800 due in 3 years from today will be replaced by a $300 payment in one (1) year from today and another payment in two (2) years from today. If the cost of money (the cost of the loan) is 6% compounded quarterly, how large should that unknown payment be? (Best Focal Point is in 2 years from today)- (Equivalent Value question-use timeline-4 marks)

(If you get the answer right, you get full marks, even without a, b & c)

1. What is the value of $500 at the focal point?
2. What is the value of $800 at the focal point?
3. What is the value of $300 at the focal point?
4. What is the amount of the unknown payment in 2 years?