question archive Find the maturity date and proceeds
Find the maturity date and proceeds
Subject:FinancePrice:2.86 Bought11
Find the maturity date and proceeds. Round to the nearest cent. K Face value: $5400 Discount rate: 12% Date made: May 30 Time: 90 days Maturity date: 2 Proceeds A) Maturity date: August 28 Proceeds $5238.00 B) Maturity date: August 28 Proceeds $5562.00 C) Maturity date. August 30 Proceeds $556200 D) Maturity date: August 30 Proceeds $5238.00 ? B ? D
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Answer : Correct option is (a.) Maturity Date August 28 ; Proceeds $5238
Reason :
Maturity Date = Date of Issue + 90 days
= 30 May + 90 days
= August 28
Proceeds = 5400 * [1 - (0.12 * 90 / 360)]
= 5238
