1. **State the problem:** We have two payments: $880 today and $1170 in 7 months. We want to find a single payment made today that is equivalent in value, assuming an interest rate of 6.25% per year. 2. **Formula and explanation:** The formula to find the present value (PV) of a future payment is: $$PV = \frac{FV}{(1 + r)^t}$$ where $FV$ is the future value, $r$ is the interest rate per period, and $t$ is the time in years. 3. **Calculate the present value of the second payment:** Given $r = 6.25\% = 0.0625$ per year, and $t = \frac{7}{12}$ years, $$PV = \frac{1170}{(1 + 0.0625)^{\frac{7}{12}}}$$ 4. **Calculate the denominator:** $$1 + 0.0625 = 1.0625$$ 5. **Calculate the exponent:** $$1.0625^{\frac{7}{12}} = e^{\ln(1.0625) \times \frac{7}{12}}$$ Calculate $\ln(1.0625) \approx 0.060625$, so exponent = $e^{0.060625 \times \frac{7}{12}} = e^{0.03536} \approx 1.0360$ 6. **Calculate present value:** $$PV = \frac{1170}{1.0360} \approx 1129.35$$ 7. **Calculate total equivalent payment today:** Add the payment today plus the present value of the future payment: $$880 + 1129.35 = 2009.35$$ **Final answer:** The single equivalent payment made today is **2009.35**.