You have a debt of $10,000 due in eight years. What is the present value of this debt assuming a nominal rate of discount of 6% compounded monthly? Round your answer to the nearest dollar.
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Since the nominal rate of discount is compounded monthly, we need to determine the number of compounding periods in eight years. Since there are 12 months in a year, the number of compounding periods is 8 years * 12 months/year = 96 months. Show more…
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