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Mercury draws a cash flow diagram to model the following scenario. A 180 -day commercial bill will mature for $500000. The price paid for the
Mercury draws a cash flow diagram to model the following scenario. A 180 -day commercial bill will mature for $500000. The price paid for the bill at issue was $487897.47. The bill was sold 70 days after issue for $496805.48. Calculate the annual rate of simple interest (as a percentage, to two decimal places) earned by the buyer who paid $487897.47 and sold for $496805.48. What was the annual rate of simple discount (as a percentage, to two decimal places) that the buyer sold at (earning a price of $496805.48)? Here is the cash flow diagram they drew. Which response best reflects the values of Z,Y,X,W,V,U,T and S ? a. Z is 180.00,Y is $500000.00,X is $487897.47,W is 70,V is $496805.48,U is not required, T is 2.12% p.a. (simple discount) and S is 9.52% p.a. (simple interest). b. Z is 180.00,Y is $500000.00,X is $487897.47,W is 70,V is $496805.48,U is not required, T is 2.02% p.a. (simple discount) and S is 9.62% p.a. (simple interest). c. Z is 180.00,Y is $500000.00,X is $487897.47,W is 110.00,V is $496805.48,U is not required, T is 3.33% p.a. (simple discount) and S is 6.06% p.a. (simple interest). d. Z is 180.00,Y is $500000.00,X is $487897.47,W is 70,V is $496805.48,U is not required, T is 2.03% p.a. (simple discount) and S is 10.25% p.a. (simple interest)
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