What is the future worth of P1,000 if it is invested at 12% compounded annually for the first year, 14% compounded quarterly on the second and third years, 16% compounded semi-annually on years 4,5,6 and 12% compounded monthly on the years 7-10?
What is the future worth of P1,000 if it is invested at 12% compounded annually for the first year, 14% compounded quarterly on the second and third years, 16% compounded semi-annually on years 4,5,6 and 12% compounded monthly on the years 7-10?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Directions: Solve all problems completely. Draw the Cash Flow Diagram. Write the formula, substitute values, and BOX the final answer. Observe accuracy: two decimal places for non-interest values and at least four (4) decimal places for interest values.
- What is the future worth of P1,000 if it is invested at 12% compounded annually for the first year, 14% compounded quarterly on the second and third years, 16% compounded semi-annually on years 4,5,6 and 12% compounded monthly on the years 7-10?
- A man borrowed P5,000 to be paid after two years with interest at 12% compounded quarterly and P10,000 to be paid after 3 years at 12% compounded monthly. What single payment must he pay after 5 years at an interest rate of 16% compounded semi-annually to settle the two obligations?
- What single equivalent amount will accumulate from an investment of P400 in 20 years at 8% compounded semi-annually?
Transcribed Image Text:Directions: Solve all problems completely. Draw the Cash Flow Diagram. Write the formula, substitute
values, and BOX the final answer. Observe accuracy: two decimal places for non-interest values and at
least four (4) decimal places for interest values.
1. What is the future worth of P1,000 if it is invested at 12% compounded annually for the first
year, 14% compounded quarterly on the second and third years, 16% compounded semi-
annually on years 4,5,6 and 12% compounded monthly on the years 7-10?
2. A man borrowed P5,000 to be paid after two years with interest at 12% compounded quarterly
and P10,000 to be paid after 3 years at 12% compounded monthly. What single payment must
he pay after 5 years at an interest rate of 16% compounded semi-annually to settle the two
obligations?
3. What single equivalent amount will accumulate from an investment of P400 in 20 years at 8%
compounded semi-annually?
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