Two payments of $1,300 and $1,800 were scheduled to be paid five months ago and three months from now, respectively. The $1,300 payment has not yet been made. What single payment at a focal date one month from now would be equivalent to the two scheduled payments if money can earn 4.5 %?

Learning Objectives

• Learn the method for evaluating the combined equivalent worth of multiple cash flows at the current time or a future moment, with a designated interest rate.
• Master the process of calculating present and future values of cash flows to refine financial planning and investment approaches.