Calculate the effective rates

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Your opportunity cost of funds can be expressed as 6% per year, compounded quarterly.

a) Calculate the following effective rates: day, month, quarter, annual

b) You have been offered a three-month internship. If the internship pays $24,000 at the end of the three month period, what is the value today of that salary? Create and label a CF timeline.

c) Assume now that the internship pays $8,000 per month (paid at the end of the month.) What is the value today of the salary? Create and label a CF timeline.

Reference no: EM133275103

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