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Chapter 1, 2.17 Smith wishes to buy a TV set and is offered a time payment...

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Finance

Chapter 1, 2.17

Smith wishes to buy a TV set and is offered a time payment planwhereby he makes 24 monthly payments of 30 each starting now. Smithwants the payments to start in 2 months rather than now. Ifinterest is at a one-month interest rate of 1%, what is the presentvalue now of the saving to Smith if the seller agrees to Smith'sterms?

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