Investment is expected to pay $750 at the end of each month.
Calculating the Present value of the periodic payment to be received:-
Where, C= Periodic Payments = $750
r = Periodic Interest rate =15%/12 =1.25%
n= no of periods = 8 years*12 = 96
Present Value = $41,793.43
So, Amount wilson should pay for Investment is $41,793.43
b). Total sum of Cash received by wilson = No of Payments*Periodic payments
= 96*$750
= $72,000
c). Difference between part(a) and (b) is called Interest
Interest = $72,000 - $41,793.43
= $30,206.57
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