The purchase of a new car requires P100,000 down payment and the balance to be paid at P300,000 after 2 years and P600,000 after 5 years. The rate of interest is 18% compounded monthly. a. Find the present worth of the car. b. Find the lump sum payment if the car is paid after 5 years. c. With a downpayment of P100,000 and monthly interest of 1.50%, find the monthly amortization for the 5 years.
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The present value of a future payment can be calculated using the formula: PV = FV / (1 + r/n)^(nt) where: - PV is the present value - FV is the future value - r is the annual interest rate (in decimal form) - n is the number of times that interest is compounded Show more…
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