1. Compute the difference in the future amount of P500 compounded annually at nominal rate of 5% and if it is compounded continuously for 5 years at the same rate? 2. Compute the effective annual interest rate which is equivalent to 5% nominal annual interest compounded continuously? 3. A construction firm wishes to give each 80 employees a holiday bonus. How much is needed to invest monthly for a year at 12% nominal interest rate, compounded monthly, so that each employee will receive a P5,000.00 bonus? 4. A debt of P10,000.00 with 10% interest compounded semi-annually is to be amortized by semi-annual payments over the next 5 years. The first due is 6 months. Determine the semi-annual payments? 5. Mr. Ramirez borrowed P15,000.00 two years ago. The term of the loan is 10% interest for 10 years with uniform payments. He just made his second annual payment. How much principal does he still owe? 6. A service car whose cash price was P540,000.00 was bought with a down-payment of P162,000.00 and monthly installments of P10,874.29 for 5 years. What was the rate of interest if compounded monthly? with solution thanks.
1. Compute the difference in the future amount of P500 compounded annually at nominal rate of 5% and if it is compounded continuously for 5 years at the same rate?
2. Compute the effective annual interest rate which is equivalent to 5% nominal annual interest compounded continuously?
3. A construction firm wishes to give each 80 employees a holiday bonus. How much is needed to invest monthly for a year at 12% nominal interest rate, compounded monthly, so that each employee will receive a P5,000.00 bonus?
4. A debt of P10,000.00 with 10% interest compounded semi-annually is to be amortized by semi-annual payments over the next 5 years. The first due is 6 months. Determine the semi-annual payments?
5. Mr. Ramirez borrowed P15,000.00 two years ago. The term of the loan is 10% interest for 10 years with uniform payments. He just made his second annual payment. How much principal does he still owe?
6. A service car whose cash price was P540,000.00 was bought with a down-payment of P162,000.00 and monthly installments of P10,874.29 for 5 years. What was the rate of interest if compounded monthly?
with solution thanks.
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