A homeowner’s insurance policy can either be paid with a one-time payment of $651 or with a payment of $139.41 now and $61.29 for 10 months. If you chose to pay it now, what would be your return on the money invested?
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Answer to 05-09-2011 problem:
(N=120,I=8,PV=0,PMT= -100) FV= $18,294.60
(N=120,I=16,PV=0, PMT= -100) FV=$29,257.06
Difference = $10,962.46