A condominium unit can be bought at a  down payment of P150,000and a monthly payment of P10,000 for 10 years starting   at the end of 5th year from the date of purchase. If money is worth 12% compounded monthly, what is the cash price of the condominium unit?

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Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.