Question 15

You join a gym for 2 years on a payment plan that requires you to pay $150 today, $700 in 6 months from today and $1000 in 18 months from today. Alternatively you could pay $1800 today. If the interest rate is 6%p.a. compounding monthly, what is the advantage that the payment plan has over the upfront payment (expressed in present day value)?

Select one:

A. $56.50

B. $54.08

C. -$54.08

D. -$50.00