Simple Interest

[mom1234]

Jonas recently purchased a one-year membership at Gold's gym. He can add a second year to the membership now for $1215, or wait 11 months and pay the regular single year price of $1280. Which is the better economic alternative if money is worth 8.5%? At what discount rate would the alternatives be equivalent?

I appreciate any help I can get on this one. Thanks!

 

[Deleted member 4993]

Jonas recently purchased a one-year membership at Gold's gym. He can add a second year to the membership now for $1215, or wait 11 months and pay the regular single year price of $1280. Which is the better economic alternative if money is worth 8.5%? At what discount rate would the alternatives be equivalent?

I appreciate any help I can get on this one. Thanks!

What is the interest payable for $1215 in 11 months @ 8.5% APR?


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