SportZ Ltd. purchases materials and services from various vendors. Money has been borrowed from the Bank of Alberta. Payments to the vendors and the bank are being planned.
a. SportZ has invoices for materials purchased from Platinum Steel Inc. The invoices are for due 60 days ago, due in 30 days, and due in 140 days. If SportZ pays all of these invoices today, how much cash is needed? Money is worth 6% per annum.
b. Bank of Alberta loan payments of due 35 days ago and due in 68 days are to be replaced by a payment of today and a further payment in 90 days. If interest on these loans is 7.2% per annum, what is the size of the final payment?
c. Prairie Plastics Ltd. is owed payments of due in 60 days and due in 120 days. Instead, SportZ has negotiated a new payment agreement in which three equal payments are to be made in 75 days, 100 days, and 200 days. If interest of 9% is charged, what is the size of the equal payments?
d. Creative Inc., a design company, has sent SportZ an invoice for services provided in the amount of , due today. Alternatively, they will accept payment of in 50 days. What interest rate is being charged?
