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4. A long-term promissory note for $10,000 is taken out on May 21,...

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4. A long-term promissory note for $10,000 is taken out on May 21, 2017. The interest rate on the note is j4 = 9%. The note is due on October 30, 2020. On January 15, 2019, the note is sold to a bank that discounts the note at j2 = 10%. (Note: for long term promissory notes, no 3 days of grace are needed) (a) Using the exact (theoretical) method, calculate the maturity value of the note. Then using the exact method again, calculate the proceeds paid by the bank. (2+2 = 4 marks) (b) Repeat (a) using the approximate (practical) method for both the maturity value and the proceeds. (2+3 = 5 marks)

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